GELLERMAN: When it comes to ambitious environmental standards and green policies, The Golden State has become the gold standard for the rest of the country. And now, California is setting the bar even higher; the state just released its final blueprint to dramatically reduce carbon emissions in every sector of its society. The limits go into effect New Year's Day 2012, and the person in charge of putting the plan into action is Mary Nichols, chairman of California's Air Resources Board. Hello, Chairman Nichols. NICHOLS: Hello. GELLERMAN: So the plan is out, and I guess there's been quite a bit of interest in it. People are downloading this document like crazy. NICHOLS: Yes, it's a best seller. [LAUGHING] NICHOLS: Of course, we're not making any money off it, but we're very happy that people are reading it. GELLERMAN: These are really major reductions that you're planning to make in greenhouse gas emissions. What does it work out to? NICHOLS: Well, we are required by law ? the state's Global Warming Solutions Act ? to return to 1990 levels by the year 2020. That translates into about a 30 percent reduction over business as usual. GELLERMAN: So sort of back to the future ? you've got to be in 2020 where you were in 1990, in terms of CO2. NICHOLS: That's right. GELLERMAN: What industry or activity will need to reduce emissions the most under this scheme? NICHOLS: Well, actually, probably the electric utilities have the most challenging target, because they not only have their own operations under their control, but because their product is used by so many of us. We're asking them to be involved in helping their customers make reductions as well, but fortunately we have a lot of experience with that in California because we've had for decades now some of the most advanced electricity efficiency programs. GELLERMAN: Well, you've had some pushback from the lobbying arm of the California Manufacturers and Technology Association. They say it's going to add billions of dollars to ratepayers and utilities. NICHOLS: Well, the CMTA is probably the leading organization other than the Western States Petroleum Association that is fighting back against the plan. They are running a big advertising campaign and what we called an Astroturf campaign - that is creating what are supposed to look like grassroots organizations of small businesses to try to slow down implementation. GELLERMAN: Well some people are not very happy with the fact that you're going to be allowing industries to buy up permits that they can trade on the open market, and that they're going to get most of those ? 90 percent of them ? for free. NICHOLS: Yes, probably the largest single number of comments that we got were from individuals, mostly organized through a Sierra Club website, who were protesting against the idea that businesses would be given these allowances for free. We intend to auction the allowances. We would start probably with a small share of the allowances being auctioned, you know ten, twenty percent, and then rapidly escalate. GELLERMAN: There's not a sector of the California society that this does not affect, especially something you have plenty of: sprawl. How are you going to deal with sprawl? NICHOLS: Well [LAUGHS] we in California are known as the home of sprawl. We're know for subdivisions that stretch out into the countryside and conversion of agricultural land and so forth, but this year, for the first time in many decades, the California legislature addressed the issue of urban sprawl signed by the governor just recently, which will allow for incentives for communities that practice smart growth by directing a larger share of the transportation funds and also giving some relief from some of our very burdensome permitting requirements. The problem is, of course, this won't happen overnight. But we know for sure that we'll never make it to our 2030 or 2050 goals, which are very dramatic, unless we get a handle on land use today. GELLERMAN: You're still going to have a lot of cars there. The Bush administration, which is on the way out, has really tied California's hands on clean cars. NICHOLS: We are still fighting with the Bush administration over the denial of a waiver under the Clean Air Act for California to enforce our clean car programs. We have been assured by both presidential candidates that we will get a waiver in the next administration, and we're also suing along with thirteen other states in federal court. So one way or another we do expect to start enforcing this program next year. But, of course, we were delayed for almost two years as a result of the Bush administration's foot dragging and intransigence. GELLERMAN: Chairman Nichols, would it be overstating it to say that in California, at least, the era of dirty fossil fuels is drawing to a close? NICHOLS: I think it would be fair to say that in California we are on the path towards a clean fuel and clean energy future. And I don't think there's any turning back. GELLERMAN: Well Chairman Nichols, I want to thank you very much for your time. NICHOLS: Thank you. GELLERMAN: Mary Nichols heads up California's Air Resources Board.