It won’t be the first battle between Gov. Jared Polis and environmental justice advocates, but a new bill from Democratic lawmakers could mark one of the most direct confrontations over Colorado’s current approach to climate change and air pollution.
The legislation filed this week calls for significant revisions to newly minted rules meant to cut climate-warming emissions from large industrial sites. In particular, it would force regulators to scrap plans to create a state-managed fund by December 2025, which could provide a last-ditch option for companies otherwise unable to comply with the regulations. Environmental groups say that could amount to a “pay-to-comply” loophole for the state’s largest polluters.
The proposal would also expand the Colorado Air Quality Control Commission, which finalized and approved the new rules in September 2023. The legislation would require the governor to appoint a climate scientist and a resident of a heavily polluted area to the state’s top air pollution authority, adding two commissioners to the eight-member panel.
“There’s a lot of trust that’s been broken between the AQCC and environmental justice groups,” said state Rep. Manny Rutinel, a Democratic sponsor of the legislation representing Commerce City. “The governor has an interest in making sure these communities are on his side, so I think there’s room for some negotiations.”
It doesn't appear the governor’s office shares that optimism for a compromise. Shelby Wieman, a spokesperson for the administration, said updated state estimates suggest the 2023 regulations — known as the GEMM 2 rule — are on track to achieve significant emissions reductions from the industrial sector.
“This bill represents a misunderstanding of the GEMM 2 rule, and instead of reducing pollution, it would force production out of state, hurting Colorado’s economy without alleviating the actual problem,” Wieman said. “The Governor’s Office will monitor this legislation but has serious concerns.”
A new edition of a familiar climate fight
The legislation — co-sponsored by state Rep. Mike Weissman, D-Aurora, and state Sen. Faith Winter, D-Westminster — is evidence some Democratic lawmakers continue to see greater state authority over air pollution as a crucial part of the state’s climate response. It’s also the latest sign of a rift on the issue between Gov. Polis and the environmental community.
Since taking office, the governor has approved ambitious climate targets but sought to meet them through a market-driven approach focused on narrow regulations and incentives. At the same time, the governor’s administration has fought back on proposals to enforce the cuts through direct rules or a California-style trading program to put a price on carbon pollution.
The foundation of the latest skirmish is an earlier fight during the 2021 legislative session. That’s when a coalition of environmental groups aligned behind a bill to beef up Colorado’s climate action plan with enforceable regulations on electricity generation, transportation, oil and gas, and heavy industry.
The governor joined with the state’s largest business groups to oppose the bill, at first threatening to veto the legislation due to concerns it would hand too much power to state air regulators. Climate advocates responded by organizing a rally in support of the bill outside the state Capitol.
Ean Thomas Tafoya, the state director of the environmental justice group GreenLatinos, organized an additional action outside the governor’s home in Boulder, which he says reflected an urgency to address poor air quality in the wake of the COVID-19 pandemic. Multiple studies have shown the disease proved particularly deadly in communities already exposed to high levels of air pollution.
“We marched on the governor’s house to pass this but then sat at the table with him and his staff working through implementation,” Tafoya said.
In the end, Polis reached a compromise to collapse parts of the bill into a separate piece of environmental justice legislation. In a victory for supporters, the final composite law — known as the Environmental Justice Act — directed state air quality regulators to approve rules to cut climate-warming emissions from the industrial and manufacturing sector 20 percent below 2015 levels by 2030.
That provision led to a rulemaking effort in 2023 to cut pollution from 18 large industrial sites around the state, including Suncor Energy refinery in Commerce City and the Molson Coors Brewery in Golden. State estimates show every facility on the list produces more than 25,000 metric tons of carbon pollution each year, a total greater than the impact of 5,000 typical gasoline-powered vehicles.
The final version of the regulations, however, mostly aligned with an alternative proposal from business groups.
The rules allow a company to first assess the cost of cutting emissions through direct investments like equipment upgrades or energy-efficiency measures. If those plans prove more expensive than a state standard, that company could purchase credits from manufacturers exceeding their emission-reduction goals. If there are no credits available, it could comply with the state rules by paying into a state-managed fund.
In addition, the commissioners directed state regulators to propose a state-managed fund, which could serve as a final option if a company can’t otherwise comply with the rules. The fund would then finance other pollution reduction efforts at manufacturing sites.
Business leaders and top state air regulators have defended the fund, saying it provides a safety valve to keep employers from leaving for states with less stringent regulations. Meanwhile, environmental groups blasted the provision, saying it puts corporate profits ahead of public health.
A response from lawmakers
A coalition of environmental groups is now backing the bill to overhaul the Air Quality Control Commission and require a rewrite of the rules for large polluters. Those groups include GreenLatinos, the Colorado Sierra Club, the Environmental Defense Fund, 350 Colorado, Mountain Mamas, and the Black Parents United Foundation.
It’s unclear if the legislation has a path forward in the legislature. After its introduction, Colorado House Speaker Julie McCluskie, D-Dillon, assigned it to the House Energy and Environment Committee, which includes a broad majority of Democrats and many of the legislature’s most aggressive climate hawks.
The plan, however, is likely to face opposition from business groups. Meghan Dollar, a senior vice president for government affairs for the Colorado Chamber of Commerce, said the business organization is still reviewing the legislation, but she’s concerned lawmakers would scrap a set of regulations forged through months of careful negotiations.
“This could set a dangerous precedent for future regulatory efforts and continues to move the goalposts on environmental policy when industry needs predictability to operate effectively,” Dollar said.
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