BILL ANALYSIS SB 210 SENATE COMMITTEE ON ENVIRONMENTAL QUALITY Senator S. Joseph Simitian, Chairman 2007-2008 Regular Session BILL NO: SB 210 AUTHOR: Kehoe AMENDED: March 20, 2007 FISCAL: Yes HEARING DATE: April 23, 2007 URGENCY: No CONSULTANT: Randy Pestor SUBJECT : GREENHOUSE GAS EMISSIONS FUEL STANDARDS SUMMARY : Existing law : 1) Under the California Global Warming Solutions Act of 2006 (CGWSA), requires the State Air Resources Board (ARB) to determine the 1990 statewide greenhouse gas (GHG) emissions level and approve a statewide GHG emissions limit that is the equivalent to that level, to be achieved by 2020. The ARB must adopt rules and regulations to achieve GHG emission reductions from sources or categories of sources, subject to certain requirements. (Health and Safety Code 38500 et seq.). 2) Under the Alternative Fuels Law, requires the California Energy Resources Conservation and Development Commission (CEC), in consultation with certain entities, to develop and adopt a state plan by June 30, 2007, to increase the use of alternative transportation fuels and set goals for 2012, 2017, and 2022 to increase alternative fuel use in the state that meet certain requirements. (Health and Safety Code 43865). 3) Requires the Office of Planning and Research to be the coordinating entity in state government for environmental justice programs and defines "environmental justice" to be "the fair treatment of people of all races, cultures, and incomes with respect to the development, adoption, implementation, and enforcement of environmental laws, regulations, and policies." (Government Code 65040.12). SB 210 Page 2 This bill enacts the Greenhouse Gas Emissions Fuel Standards Law that: 1) Requires the ARB to adopt, implement, and enforce a low-carbon fuel standard by January 1, 2010, that achieves GHG emissions reductions, and at least a 10% reduction in GHG emissions in furtherance of the limit established by the CGWSA. 2) Requires the low-carbon fuel standard to: a) for gasoline, maintain or improve upon emissions reductions and air quality benefits achieved by the California Phase 2 Reformulated Gasoline Program as of January 1, 1999, including emissions reductions for all pollutants and precursors identified in the State Implementation Plan for ozone, and emissions of potency weighted toxics compounds and particulate matter; b) for diesel fuel, maintain or improve upon emissions reductions and air quality benefits achieved by specified California diesel fuel regulations; and c) ensure that implementing the low-carbon fuel standard does not result in greater impacts on low-income communities and is consistent with environmental justice. 3) Requires the CEC to update and reissue the Alternative Fuels Law report with additional recommendations by June 30, 2009. COMMENTS : 1) Purpose of Bill . According to the author, AB 32 (Nunez) Chapter 488, Statutes of 2006, "aimed at reducing California's [GHG] emissions, provides direction and broad authority to the [ARB] to achieve the maximum in technologically feasible and cost-effective reductions in [GHG] emissions." The author notes that Governor Schwarzenegger issued Executive Order (EO) S-01-07 that calls for "a statewide goal to be established to reduce the carbon intensity of California's transportation fuels by at least 10 percent by 2020" and that SB 210 codifies this provision of the EO "making his directive binding under the law and clarifying that environmental and public health safeguards will be consistent with AB 32." SB 210 Page 3 2) Effort to implement EO S-01-07 . EO S-01-07, dated January 18, 2007, provides that "a statewide goal be established to reduce the carbon intensity of California's transportation fuels by at least 10 percent by 2020 ('2020 Target')" and "a Low Carbon Fuel Standard ('LCFS') for transportation fuels be established for California." Federal clean air laws require areas with unhealthy levels of ozone, carbon monoxide, nitrogen dioxide, sulfur dioxide, and particulate matter to develop plans, known as State Implementation Plans (SIPs), showing how national ambient air quality standards (NAAQS) will be attained. SIPs are a compilation of new and previously submitted plans, programs (e.g., modeling, monitoring, permitting), district rules, state regulations and federal controls. Many of California's SIPs rely on certain control strategies, including emission standards for cars and heavy trucks, fuel regulations, and limits on emissions from consumer products. ARB is the lead agency for all purposes related to the SIP. Local air districts and other agencies, such as the Bureau of Automotive Repair, prepare SIP elements and submit them to ARB for review and approval. ARB forwards SIP revisions to the U.S. Environmental Protection Agency for approval and publication in the Federal Register. SB 210 is an effort to respond to the EO by requiring a low-carbon fuel standard by January 1, 2010, that achieves at least a 10% reduction in GHG emissions, in furtherance of the CGWA established limits. However, the SB 210 standards should also be contained in the SIP. 3) Opposition and support concerns . In opposing SB 210, Western States Petroleum Association (WSPA) indicates that this bill creates a separate fuel standard than required under the EO by referring to a GHG reduction rather than reducing carbon intensity of California's transportation fuels by 2020, and prevents the use of any lower carbon intensity or renewable fuel that would result in any emissions increases. SB 210 Page 4 Supporters believe this bill will foster cleaner alternative fuels by establishing air quality criteria, and some supporters recommend that this bill also require lifecycle and multimedia analysis, require sustainability review, and clarify that the standard includes heavy-duty and light-duty fuels. 4) Related legislation . AB 747 (Levine) of 2007 also addresses GHG emissions fuel standards. SB 140 provides for statewide blends of renewable diesel fuel and is similar to SB 1675 (Kehoe) of 2006, which failed on the Assembly Floor (33-40). SB 494 (Kehoe) enacts the Clean Alternative Fuel and Clean Vehicle Act of 2007 to require certain percentages of new passenger vehicles and light-duty trucks sold in California to be "clean alternative vehicles" (SB 494 is similar to AB 1012 (Nation) of 2006, which was vetoed). 5) Clarification needed . The author wants to respond to the concern that the low carbon fuel standard be subject to a lifecycle and multimedia analysis, as well as a sustainability analysis. In responding to this concern, it would be appropriate to ensure that such an analysis would not conflict with the multimedia analysis required under current law. The environmental justice provisions of this bill should be clarified to ensure that adoption, implementation, and enforcement of the low-carbon fuel standard are consistent with environmental justice. The requirement to update the Alternative Fuels Law report (page 4, lines 4 to 7) should be contained under that Law, rather than in a separate section as provided under this bill. SOURCE : Senator Kehoe SUPPORT : American Lung Association of California, California Association of Professional Scientists, Environment California, Planning and Conservation League, Sierra Club SB 210 Page 5 California, Union of Concerned Scientists OPPOSITION : California Independent Marketers Association, California Trucking Association, Western States Petroleum Association