THE MAKING OF A GREEN GIANT ARNOLD CAN LEAD ON GLOBAL WARMING.

Byline: RICHARD NEMEC Local View

SUDDENLY, it seems, global warming is macho! CEOs and politicians alike are evoking the c-words (climate change), and vowing to fight it alongside global terrorism.

California's Gov. Arnold Schwarzenegger, known for accusing his adversaries of being ``girlie-men,'' embraced climate change as an issue a full year ago, setting ambitious goals for rolling back emissions of so-called greenhouse gases, mostly carbon dioxide, whose biggest sources are large electric generation plants, motor vehicles and factory smokestacks.

The governor's latest high-profile greening involved meeting with British Prime Minister Tony Blair to announce an agreement between the state and UK to share information and help one another find market-based solutions for combating greenhouse gases.

This ``green'' side is one half of Schwarzenegger's split personality. The other side is fiscal conservatism, believing in markets over regulation, voluntary action over mandatory rules, retail price increases rather than tax increases.

As a result, the governor is in a quandary on what to do with pending state legislation -- Assembly Bill 32 -- to make mandatory various pollution limits to help reach goals he's already endorsed. The catch is that the proponents of AB 32 -- Democratic lawmakers and environmental groups -- want to mandate the new program.

AB 32's author, Assembly Speaker Fabian NuIllegal 'X-value' for character STYLs voided here ez, attended the Schwarzenegger-Blair meeting, and the bill itself was put in the state Senate's ``Suspense File'' during a hearing last Monday in the Senate Appropriations Committee.

Called the ``Global Warming Solutions Act of 2006,'' AB 32 would direct the state's Air Resources Board to adopt regulations by 2008 to monitor and report on existing emissions and any changes in their levels for greenhouse gases. All power-plant operators, for example, would have to regularly report how much pollution they're spewing, and eventually start reducing it.

Advocates for the legislation -- who include impressive numbers of business leaders as well as the usual champions of environmental causes -- are fearful that when push comes to shove in this election year, Schwarzenegger, running as a Republican, will veto the bill.

That's assuming it gets out of the Legislature, which Speaker NuIllegal 'X-value' for character STYLs voided here ez's aides were predicting would happen in another week, although the California Chamber was still adamantly opposed to mandated reporting and emission limits.

Although global warming has yet to be recognized as an official problem in the White House, a recent study by the National Research Council concluded that Earth has gotten warmer over the past 100 years and human activity is the main cause.

While President George W. Bush's administration may be avoiding the issue, there is no avoiding it for business executives and regulatory leaders who are forced to think beyond four-year political terms. A dozen CEOs from some of the world's largest companies joined Schwarzenegger and Blair on July 31 when they met at a British Petroleum facility in Long Beach Harbor.

A major national power plant owner with substantial assets in polluting, coal-fired generation recently announced a $16 billion, 10-year electric generation development plan that would push for clean coal, wind and natural gas-fired power plants. One of the main reasons for the plan, the owner said, was that the electricity industry -- as the largest stationary source of greenhouse gases -- has a ``moral obligation'' to address global warming.

Banks and other Wall Street investors now are bellying up to the bar because they sense the economic ramifications of this. California's chief regulator, Michael Peevey, who once was president of Southern California Edison Co, told an investment banking conference on alternative energy this spring that while climate change represents a ``formidable challenge,'' it also -- as Schwarzenegger likes to echo -- holds significant economic development opportunities.

Global warming's reversal, or at least mitigation in the short term, will require ``lots of money,'' Peevey told the investment bankers on Wall Street. He said there are ``boundless opportunities for profitable new products and business models.''

While the issue of mandatory vs. voluntary reporting and compliance still looms big in the legislative halls of Sacramento, that red herring should be tossed back in the drink as the speaker's and governor's people continue to seek a compromise. The key driver should be the larger issue of what could be a positive shift for both the environment and the economy.

As they again zero in on the issue this month, California lawmakers need to make a statement on global warming that can lead on a national basis. And if they do, the governor should sign it as a jump-start for the whole country, let alone a predominantly nonindustrialized world that is indifferent, at best, and needs to be led in the right direction.

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2 photos

Photo:

(1 -- color) Gov. Arnold Schwarzenegger and British Prime Minister Tony Blair attend a news conference at the Port of Long Beach on July 31.

David McNew/Getty Images

(2 -- color) no caption (Governor Arnold Schwarzenegger)