BILL NUMBER: AB 32	AMENDED
	BILL TEXT

	AMENDED IN SENATE  APRIL 18, 2006
	AMENDED IN SENATE  AUGUST 15, 2005
	AMENDED IN ASSEMBLY  MARCH 31, 2005

INTRODUCED BY   Assembly  Member   Pavley
  Members   Nunez   and Pavley 
    (   Principal coauthor:   Assembly Member
  Nation   ) 
   (Coauthors: Assembly Members  Chan,  
  Hancock,   Berg,   Chan,
  Cohn,   Goldberg,   Hancock,  
Jones,   Klehs, Koretz,  and Laird 
 Laird,   Leno,   Lieber,  
Ridley-Thomas,   Saldana,   and Yee  )
   (  Coauthor:   Senator  
Simitian   Coauthors:   Senators  
Bowen,  Escutia,   Kehoe,   Kuehl, 
 and Simitian  )

                        DECEMBER 6, 2004

   An act to amend  Sections 42801 and 42823  
Section 39003  of, and to add Chapter  6.5 
 7  (commencing with Section 42875) to Part 4 of Division 26
of, the Health and Safety Code,  and to amend Section 25730 of
the Public Resources Code,  relating to air pollution.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 32, as amended,  Pavley   Nunez 
 Greenhouse gas emissions.   Air pollution:
California Global Warming Solutions Act of 2006: greenhouse gases.

    Under existing law, the State Air Resources Board, the State
Energy Resources Conservation and Development Commission (Energy
Commission), and the California Climate Action Registry all have
responsibilities with respect to the control of emissions of
greenhouse gases, as defined, and the Secretary for Environmental
Protection is required to coordinate emission reductions of
greenhouse gases and climate change activity in state government.
 
   This bill would enact the California Global Warming Solutions Act
of 2006, to require the state board to adopt regulations on or before
January 1, 2008, establishing a program to monitor and report on
existing emissions and changes in emissions of greenhouse gases from
sources identified by the state board, and to monitor compliance with
emission limits on greenhouse gases, as specified. The bill would
provide that the state board is the state agency charged with
monitoring, tracking, and regulating the sources and reducing
emissions of gases known to cause global warming. The bill would
require the state board to adopt regulations, on or before January 1,
2008, to reduce statewide greenhouse gas emissions to 1990 emission
levels by 2020, as specified. The bill would require the Governor to
establish an interagency task force to coordinate investments of
state moneys and state programs that reduce emissions of greenhouse
gases, promote economic growth, make information publicly available
to assist sources of greenhouse gases to meet the emissions
requirements of the bill, ensure that existing state programs support
the emissions requirements of the bill, and monitor conditions and
coordinate planning and the state's response to changing climate
conditions as they impact state water supplies, air quality, and
environmental and public health conditions.  
   Under existing law the Energy Commission, in consultation with
certain state agencies, departments, and boards with jurisdiction
over matters affecting climate change, is required, by January 1,
2002, to update the inventory of greenhouse gas emissions from all
sources located in the state, as identified in a specified report, to
update its inventory every 5 years, and to report on the updated
inventory to the Governor and the Legislature. Existing law requires
the Energy Commission to conduct at least one public workshop prior
to finalizing each updated inventory and to post its report and
inventory on the Internet. Existing law additionally requires the
Energy Commission to convene an interagency task force consisting of
state agencies with jurisdiction over matters affecting climate
change to ensure policy coordination for those activities, and to
establish a climate change advisory committee, as provided, to make
recommendations to the Energy Commission on the most equitable and
efficient ways to implement international and national climate change
requirements, as provided.  
   This bill would delete the above-described requirements and
instead require that the Energy Commission update its inventory of
emissions of greenhouse gases to supplement the information collected
by the state board and enable the state board to maintain a
reasonably comprehensive inventory of the state's emissions of
greenhouse gases. 
   Existing law requires the Secretary of the Resources Agency to
establish the California Climate Action Registry (hereafter registry)
as a public benefit nonprofit corporation, and makes legislative
findings and declarations relating to the registry. Existing law
requires the registry to perform various functions, including, among
other things, the adoption of procedures and protocols for the
reporting and certification of greenhouse gas emissions reductions
resulting from a project or an action of a participant in the
registry.  
    This bill would revise the functions and duties of the registry
by requiring the registry, in coordination with the California
Environmental Protection Agency and the State Energy Resources
Conservation and Development Commission, to adopt specified
procedures and protocols for monitoring, estimating, calculating,
reporting, and certifying greenhouse gas emissions resulting from
specified industrial sectors, as provided. This bill would require
the registry to coordinate with state agencies to promote the
development of harmonized reporting standards, as specified, and
would require the registry, to the extent possible, to coordinate
with other states and regions to ensure that businesses and
organizations operating both in this state and out of state follow
uniform protocols when reporting to multiple registries, states, or
regions.  
   The bill would enact the California Climate Act of 2006 to require
the Secretary of the California Environmental Protection Agency to
institute a cap on greenhouse gas emissions from the electrical
power, industrial, and commercial sectors of the economy, institute a
schedule of emissions reductions for specified entities, develop an
enforcement mechanism for reducing greenhouse gas emissions to the
target level, and establish a program to track and report greenhouse
gas emissions and to monitor and enforce compliance with the
greenhouse gas emissions cap. The bill would require the secretary,
on or before January 1, 2008, to submit a detailed plan to achieve
the greenhouse gas emissions cap to the Governor and the Legislature,
and to submit a report, on or before January 1, 2009, and annually
thereafter, on the progress made toward meeting the greenhouse gas
emissions cap. The bill would set standards for the schedule of
greenhouse gas emissions reductions, and would require, by
regulation, any entity subject to the greenhouse gas emissions cap to
be prohibited from meeting those obligations using emissions
reductions achieved outside the scope of the greenhouse gas emissions
cap. This bill would also make legislative findings and declarations
with regard to reducing greenhouse gas emissions associated with
climate change. 
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


   SECTION 1.    Section 39003 of the   Health
and Safety Code   is amended to read: 
   39003.  The State Air Resources Board is the state agency charged
with coordinating efforts to attain and maintain ambient air quality
standards, to conduct research into the causes of and solution to air
pollution,  to monitor, track, and regulate the sources and
reduce emissions of gases known to cause global warming,  and to
systematically attack the serious problem caused by motor vehicles,
which is the major source of air pollution in many areas of the
state.
   SEC. 2.    Chapter 7 (commencing with Section 42875)
is added to Part 4 of Division 26 of the   Health and Safety
Code   , to read: 
       CHAPTER 7.  CALIFORNIA GLOBAL WARMING SOLUTIONS ACT OF
2006

   42875.  (a) This chapter shall be known, and may be cited, as the
California Global Warming Solutions Act of 2006.
   (b) For purposes of this chapter, the following terms have the
following meanings:
   (1) "Carbon dioxide equivalents" means the amount of carbon
dioxide by weight that would produce the same global warming impact
as a given weight of another greenhouse gas, to be determined based
on the most recent information available from the Intergovernmental
Panel on Climate Change.
   (2) "Cost-effectiveness" means the net costs, or the costs less
the benefits, per unit of reduced emissions of greenhouse gases.
   (3) "Direct," "indirect," and "cumulative" shall have the same
meanings as those terms are defined in Sections 1508.7 and 1508.8 of
Title 40 of the Code of Federal Regulations.
   (4) "Greenhouse gases" means "greenhouse gases" as defined in
Section 42801.1.
   (5) "Load-serving entity" means any entity, including an
electrical corporation, as defined in Section 218 of the Public
Utilities Code, local publicly owned electric utility, as defined in
Section 9604 of the Public Utilities Code, electric service provider,
as defined in Section 218.3 of the Public Utilities Code, private
energy producer, as defined in Section 2802 of the Public Utilities
Code, a facility that uses cogeneration, as defined in Section 218.5
of the Public Utilities Code, for the generation of electricity, and
a community aggregator operating pursuant to Section 366.2 of the
Public Utilities Code, that provides electricity to retail end-use
customers. "Load-serving entity" does not include the California
Energy Resources Scheduling division within the Department of Water
Resources, when acting pursuant to Division 27 (commencing with
Section 80000) of the Water Code.
   42875.1.  It is the policy of the state that all state agencies
consider and implement measures to reduce greenhouse gas emissions.
This policy shall be incorporated into all state agencies'
decisionmaking activities.
   42876.  (a) On or before January 1, 2008, the state board shall
identify all significant sources of emissions of greenhouse gases and
adopt regulations establishing a program to accomplish the
following:
   (1) Monitor and report existing emissions and changes in emissions
over time, from sources identified by the state board.
   (2) Monitor compliance with the emissions limits on greenhouse
gases established by the state board pursuant to Section 42877.
   (b) The state board shall require reporting of the greenhouse gas
emissions associated with fossil fuels used in California by entities
that are the gateways for those fossil fuels, including oil
refineries, oil storage facilities, and natural gas pipelines.
   (c) The state board shall require reporting of emissions of
greenhouse gases by all load-serving entities, for all electricity
consumed in the state, accounting for transmission line losses,
whether the electricity is generated within the state or generated
outside the state and imported into the state.
   (d) The state board shall require reporting of emissions of
greenhouse gases from any additional entities that are significant
emitters of greenhouse gases, as appropriate to enable the state
board to monitor compliance with the emissions limits for greenhouse
gases established pursuant to Section 42877.
   (e) The state board shall, to the extent feasible, incorporate the
standards and protocols developed by the California Climate Action
Registry, established pursuant to Chapter 6 (commencing with Section
42800), as the basis for the monitoring and reporting of emissions of
greenhouse gases. Entities that voluntarily participated in the
California Climate Action Registry prior to December 31, 2006, and
have a fully developed reporting program, shall not be required to
significantly alter their reporting or verification program except as
necessary to ensure that reporting is complete and transparent for
the purposes of state regulation and tracking of emissions of
greenhouse gases.
   42877.  (a) On or before January 1, 2008, the state board shall
adopt regulations that will reduce statewide greenhouse gas emissions
to 1990 emission levels by 2020, taking into account projected
reductions in greenhouse gas emissions from state agency programs not
subject to this chapter. The emission limits shall be expressed in
total tons of allowable emissions of greenhouse gases, expressed in
carbon dioxide equivalents, and shall include all emissions of
greenhouse gases from the generation of electricity delivered by
load-serving entities and consumed in California, whether generated
in-state or imported. The state board shall consult with air
pollution control districts and air quality management districts in
the development of measures for the reduction of emissions of
greenhouse gases that will affect emissions of criteria pollutants
from stationary sources.
   (b) In order to achieve the statewide limit for 2020 greenhouse
gas emissions established in subdivision (a), the state board shall
establish a series of enforceable limits to become effective
beginning on January 1, 2012, that gradually reduce emissions levels
to the 2020 limit.
   (c) The regulations adopted by the state board shall do all of the
following:
   (1) Distribute the costs and benefits of the program, including
emission allowances, in a manner that is equitable, maximizes the
total benefit to the economy, does not disproportionately burden low-
and moderate-income households, provides compliance flexibility
where appropriate, and ensures that entities that have voluntarily
reduced their emissions receive appropriate consideration for
emissions reductions made prior to the implementation of this
program.
   (2) Ensure that the measures implemented to achieve reductions in
emissions of greenhouse gases do not result in a direct, indirect, or
cumulative increase in emissions of toxic air contaminants,
identified pursuant to Article 3 (commencing with Section 39660) of
Chapter 3.55 of Part 2, or cause or contribute to a violation of a
federal or California health-based ambient air quality standard, in
any community.
   (3) Evaluate emissions reduction opportunities based upon their
cost-effectiveness and additional societal benefits, including
reductions in other air pollutants, energy security, and protection
of the environment and public health.
   (4) Minimize the administrative burden of implementing and
complying with the program.
   (5) Minimize displacement of emissions outside of the scope of the
program established by this chapter.
   (6) Where feasible, coordinate with other states and countries to
reduce emissions of greenhouse gases in a manner that does not
conflict with California law and regulations.
   (d) The emission limits for greenhouse gases established by the
state board shall be enforced pursuant to Article 1 (commencing with
Section 42300) of Chapter 4.
   (e) On or before January 1, 2009, and annually thereafter, the
state board, in consultation with the task force established pursuant
to Section 42878, shall report to the Legislature on the current
level of emissions of greenhouse gases and progress made toward
compliance with the emissions limits on greenhouse gases established
by the state board pursuant to subdivision (b). The report shall
include an inventory of current emissions of greenhouse gases based
upon information reported to the state board pursuant to this section
and information provided by the State Energy Resources Conservation
and Development Commission pursuant to Section 25730 of the Public
Resources Code. The report shall include historical and forecasted
levels of emissions of greenhouse gases that compares emissions from
similar inventories prepared for other states, for the United States,
and for other countries, a description of ongoing efforts to reduce
emissions of greenhouse gases, and a summary of additional measures
that may be taken in the future.
   (f) On or before January 1, 2015, the state board shall evaluate
technological capability and economic factors, and adopt regulations
that establish a statewide limit on emissions of greenhouse gases, to
become effective on January 1, 2030, and a regularly scheduled
series of limits that will gradually reduce emissions of greenhouse
gases from the 2020 emissions limit, to meet the 2030 emissions
limit.
   42878.  (a) The Governor shall establish an interagency task
force, which shall consist of the following:
   (1) The Secretary for Environmental Protection or his or her
designee.
   (2) The chairperson of the state board or his or her designee.
   (3) The Secretary of the Resources Agency or his or her designee.

   (4) The Chair of the State Energy Resources Conservation and
Development Commission or his or her designee.
   (5) The President of the Public Utilities Commission or his or her
designee.
   (6) Representatives of other state agencies or departments that
the Governor determines have an important role in reducing emissions
of greenhouse gases.
   (b) The interagency task force shall, to the extent feasible, do
all the following:
   (1) Coordinate investments of state moneys and state programs that
reduce emissions of greenhouse gases.
   (2) Promote economic growth by encouraging industries that develop
and deploy in the state, and export from the state, technologies and
processes that reduce greenhouse gas emissions.
   (3) Make information publicly available about state programs that
may provide assistance for sources of greenhouse gases to meet the
requirements of this chapter.
   (4) Ensure that existing state programs support the emissions
limits on greenhouse gases established by the state board pursuant to
Section 42877.
   (5) Monitor conditions and coordinate planning and the state's
response to changing climate conditions as they impact state water
supplies, air quality, and environmental and public health
conditions.
   42879.  (a) Nothing in this chapter shall relieve any entity of
compliance with state air and water quality requirements, or other
requirements for protecting public health or the environment.
   (b) Nothing in this chapter shall limit the existing authority of
any local or regional authority. 
   SEC. 3.   Section 25730 of the   Public
Resources Code   is amended to read: 
   25730.  The commission, in consultation with the State Air
Resources Board, the Department of Forestry and Fire Protection, the
Department of Transportation, the State Water Resources Control
Board, the California Integrated Waste Management Board, and other
state agencies with jurisdiction over matters affecting climate
change, shall do  all   both  of the
following:  
   (a) On or before January 1, 2002, update the inventory of
greenhouse gas emissions from all sources located in the state, as
identified in the commission's 1998 report entitled, "Appendix A:
Historical and Forecasted Greenhouse Gas Emissions Inventories for
California." Information on natural sources of greenhouse gas
emissions shall be included to the extent that information is
available. The inventory shall include information that compares
emissions from similar inventories prepared for the United States and
other states or countries, and shall include information on relevant
current and previous energy and air quality policies, activities,
and greenhouse gas emissions reductions and trends since 1990, to the
extent that information is available.  
   (b) 
    (a)   Acquire and develop data and information
on global climate change, and provide state, regional, and local
agencies, utilities, business, industry, and other energy and
economic sectors with information on the costs, technical
feasibility, and demonstrated effectiveness of methods for reducing
or mitigating the production of greenhouse gases from in-state
sources, including net reductions through the management of natural
forest reservoirs.  The commission, in consultation with the State
Air Resources Board, shall provide a variety of forums for the
exchange of that information among interested parties, and shall
provide other state agencies with information on cost-effective and
technologically feasible methods that can be used to reduce or
mitigate the emissions of greenhouse gases.  
   (c) Update its inventory every five years using current scientific
methods, and report on the updated inventory to the Governor and the
Legislature.  
   (d) Conduct at least one public workshop prior to finalizing each
updated inventory. The commission shall post its report and inventory
on the commission's web page on the Internet.  
   (e) Convene an interagency task force consisting of state agencies
with jurisdiction over matters affecting climate change to ensure
policy coordination at the state level for those activities.
 
   (f) Establish a climate change advisory committee, to the extent
that the commission determines that it can do so within existing
resources. This advisory committee shall make recommendations to the
commission on the most equitable and efficient ways to implement
international and national climate change requirements based on cost,
technical feasibility, and relevant information on current energy
and air quality policies and activities and on greenhouse gas
emissions reductions and trends since 1990. The commission shall
designate one of its commissioners as chair, and shall include on the
advisory committee members who represent business, including major
industrial and energy sectors, utilities, forestry, agriculture,
local government, and environmental groups. The meetings of the
advisory committee shall be open to the public, and shall provide an
opportunity for the public to be heard on matters considered by the
advisory committee.  
   (b) Update its inventory of emissions of greenhouse gases in order
to supplement the information collected by the State Air Resources
Board pursuant to Section 42877 of the Health and Safety Code, and to
enable the State Air Resources Board to maintain a reasonably
comprehensive inventory of the state's emissions of greenhouse gases.
   All matter omitted in this version of the bill appears in
the bill as amended in Senate, August 15, 2005 (JR11)