BILL NUMBER: AB 1318 INTRODUCED
BILL TEXT
INTRODUCED BY Assembly Member V. Manuel Perez
(Principal coauthors: Senators Ducheny and Benoit)
FEBRUARY 27, 2009
An act to add and repeal Section 40453 of the Health and Safety
Code, relating to air pollution, and declaring the urgency thereof,
to take effect immediately.
LEGISLATIVE COUNSEL'S DIGEST
AB 1318, as introduced, V. Manuel Perez. South Coast Air Quality
Management District: emission reduction credits for electrical
generating facilities.
(1) Under existing law, every air pollution control district or
air quality management district governing board, except as specified,
is required to establish by regulation a system by which all
reductions in the emission of air contaminants that are to be used to
offset certain future increases in the emission of air contaminants
are required to be banked prior to use to offset future increases in
emissions, as provided.
This bill would require the executive officer of the South Coast
Air Quality Management District, upon making a specified finding, to
transfer a specified quantity of emission reduction credits for
certain pollutants from the south coast district's internal emission
credit accounts to eligible electrical generating facilities, as
described, thereby imposing a state-mandated local program. The bill
would grant the State Energy Resources Conservation and Development
Commission the exclusive authority to review the environmental impact
of the executive officer's actions. These provisions would be
repealed on January 1, 2013.
The bill would state the findings and declarations of the
Legislature concerning the need for special legislation.
(2) The California Constitution requires the state to reimburse
local agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that, if the Commission on State Mandates
determines that the bill contains costs mandated by the state,
reimbursement for those costs shall be made pursuant to these
statutory provisions.
(3) The bill would declare that it is to take effect immediately
as an urgency statute.
Vote: 2/3. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. The Legislature finds and declares all of the
following:
(a) Sufficient rotating electrical generation capacity is required
within the Los Angeles Basin Local Reliability Area to ensure stable
operation of the power grid. Future load growth and the anticipated
retirement of aging, inefficient gas-fired capacity will cause the
power grid to be unacceptably below minimum safety levels, absent the
passage of this measure.
(b) Energy efficiency and renewable resources, which are primarily
located outside of the Los Angeles Basin Local Reliability Area, are
unable to satisfy the in-basin rotating electrical generation
capacity need.
(c) In October 2005, the Public Utilities Commission and the State
Energy Resources Conservation and Development Commission
(commission) adopted the Energy Action Plan II, which establishes a
policy that the state will rely on clean and efficient fossil
fuel-fired generation to the extent energy efficiency and renewable
resources are unsuitable.
(d) The Energy Action Plan II establishes a policy that the state
will encourage the development of cost-effective, highly efficient,
and environmentally sound supply resources to provide reliability and
consistency with the state's energy priorities.
(e) Executive Order S-14-08, signed by the Governor on November
17, 2008, calls for a new, more aggressive renewable energy target,
increasing the current goal of obtaining 20 percent of the energy
used by electrical corporations from clean, renewable sources by the
year 2010 to 33 percent by the year 2020. Expanding the use of
renewable electricity must be accompanied by additional quick-start,
high ramp rate, nonrenewable electrical generating units to meet peak
demand and respond to production variations inherent in intermittent
renewable electricity supplies.
(f) New electrical generating capacity in the Los Angeles Basin
Local Reliability Area is required to meet best available control
technology (BACT) standards and is required to fully offset any
remaining emissions of nonattainment pollutants, including sulfur
oxides and particulate matter with emission credits.
(g) Emission credits available in the air basins regulated by the
South Coast Air Quality Management District are insufficient to allow
new electrical generating capacity to be constructed, and new
emission credits cannot be created quickly enough, and in sufficient
quantity, to facilitate timely construction of needed new generation
capacity.
(h) The South Coast Air Quality Management District maintains
internal emission credit accounts that it uses to permit, among other
things, small and essential public services.
(i) Requiring the South Coast Air Quality Management District to
provide emission reduction credits from the district's internal
accounts for projects for new electrical generating capacity located
outside of the South Coast Air Basin, and that have entered into
agreements with an electrical corporation to provide electricity in
the Los Angeles Basin Local Reliability Area, is the only way to
ensure the timely construction of needed capacity while mitigating
impacts on air quality.
(j) Such a transfer of emission credits would not conflict with
the provisions of the Protect California Air Act of 2003 (Chapter 4.5
(commencing with Section 42500) of Part 4 of Division 26 of the
Health and Safety Code) because the new electrical generating
capacity will be subject to review that is equivalent to the
California Environmental Quality Act (Division 13 (commencing with
Section 21000) of the Public Resources Code) by the State Energy
Resources Conservation and Development Commission, and to the
requirements to meet BACT standards and fully offset any remaining
emissions.
(k) Transferring authority to review the environmental impacts of
crediting and transferring emission credits to the State Energy
Resources Conservation and Development Commission will ensure that
there will be environmental review of the potential impacts while
ensuring timely construction of the needed capacity.
(l) This act is necessary to ensure timely construction of needed
new electrical generating capacity.
SEC. 2. Section 40453 is added to the Health and Safety Code, to
read:
40453. (a) The executive officer, in cooperation with the State
Energy Resources Conservation and Development Commission and upon
finding that the eligible electrical generating facility proposed for
certification by the State Energy Resources Conservation and
Development Commission meets the requirements of the applicable new
source review rule and all other applicable district regulations that
must be met under Section 1744.5 of Title 20 of the California Code
of Regulations, shall credit to its internal emission credit accounts
and transfer from its internal emission credit accounts to eligible
electrical generating facilities emission credits up to the following
aggregate amounts:
(1) Sulfur oxides (SOx) in the amount of 0.1 tons per day.
(2) Fine particulate matter (PM10) in the amount of 0.6 tons per
day.
(b) The south coast district may rely on the south coast district'
s Rule 1315, as adopted on August 3, 2007, to credit emission credits
to its internal emission credit accounts to carry out the
obligations of subdivision (a).
(c) The emission reduction credits in subdivision (a) shall
satisfy all state and south coast district requirements related to
the provision of credits or offsets for new electrical generating
facilities.
(d) In order to be eligible for emission reduction credits
pursuant to this section, an electrical generating facility shall
meet all of the following requirements:
(1) Be subject to the permitting jurisdiction of the State Energy
Resources Conservation and Development Commission.
(2) Be subject to environmental analysis pursuant to the State
Energy Resources Conservation and Development Commission's power
facility and site certification authority (Chapter 6 (commencing with
Section 25500) of Division 15 of the Public Resources Code).
(3) Have a purchase agreement, executed on or before December 31,
2008, to provide electricity to a public utility, as defined in
Section 216 of the Public Utilities Code, subject to regulation by
the Public Utilities Commission, for use within the Los Angeles Basin
Local Reliability Area.
(4) Be under the jurisdiction of the south coast district, but not
within the South Coast Air Basin.
(e) The executive officer shall not transfer emission reduction
credits pursuant to this section until the receipt of payment of the
mitigation fees set forth in the south coast district's Rule 1309.1,
as adopted on August 3, 2007. The mitigation fees shall only be used
for emission reduction purposes. The south coast district shall
ensure that at least 30 percent of the fees are used for emission
reductions in areas within close proximity to the electrical
generating facility and at least 30 percent are used for emission
reductions in areas designated as "Environmental Justice Areas" in
Rule 1309.1.
(f) The executive officer's authority to transfer emission
reduction credits pursuant to this section shall terminate when the
executive officer has transferred emission reduction credits in
amounts that are equal to the aggregate amounts set forth in
subdivision (a).
(g) (1) Notwithstanding any other provision of law, the State
Energy Resources Conservation and Development Commission shall have
exclusive authority to review the environmental impact, if any, of
the executive officer's acts in identifying, crediting, and placing
the emission credits to be transferred under this section into the
new source review tracking system that the south coast district
maintains and in transferring these credits to eligible electrical
generating facilities for use in offsetting emissions of eligible
facilities. The commission shall complete this review within 60 days
of the effective date of this section. The commission shall exercise
this authority in a manner that is consistent with its regulatory
responsibilities under Chapter 6 (commencing with Section 25500) of
Division 15 of the Public Resources Code, including its
responsibilities as an agency that maintains a certified regulatory
program under the California Environmental Quality Act (Division 13
(commencing with Section 21000) of the Public Resources Code) as
specified in Section 15251 of Title 14 of the California Code of
Regulations. If the commission determines that the executive officer'
s actions in identifying, crediting, and transferring emission
credits will have a significant environmental impact, the commission
shall have exclusive authority to impose conditions to mitigate
environmental impacts as a condition of certification of a project
that receives credits pursuant to this section. The actions of the
commission pursuant to this section shall be subject to judicial
review only in accordance with the provisions for powerplant facility
and site certification as set forth in Section 25531 of the Public
Resources Code.
(2) The State Energy Resources Conservation and Development
Commission may find that the transferred emission credits conform
with the requirements of paragraph (1) of subdivision (d) of Section
25523 notwithstanding the requirement in paragraph (2) of subdivision
(d) of Section 25523 of the Public Resources Code.
(h) This section shall be implemented in a manner consistent with
federal law, including the Clean Air Act (42 U.S.C. Sec. 7401 et
seq.).
(i) This section shall remain in effect only until January 1,
2013, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2013, deletes or extends
that date.
SEC. 3. Due to unique circumstances concerning the South Coast Air
Quality Management District, the Legislature finds and declares that
a general statute cannot be made applicable within the meaning of
Section 16 of Article IV of the California Constitution.
SEC. 4. If the Commission on State Mandates determines that this
act contains costs mandated by the state, reimbursement to local
agencies and school districts for those costs shall be made pursuant
to Part 7 (commencing with Section 17500) of Division 4 of Title 2 of
the Government Code.
SEC. 5. This act is an urgency statute necessary for the immediate
preservation of the public peace, health, or safety within the
meaning of Article IV of the Constitution and shall go into immediate
effect. The facts constituting the necessity are:
In order to help create sufficient electrical generating capacity
in southern California to meet the current and future needs of the
region and to prevent rolling blackouts during peak demand periods,
thereby preserving the public peace, health, and safety, and to
provide the necessary infrastructure to support increased reliance on
renewable sources of energy, it is necessary that this statute take
effect immediately.