BILL ANALYSIS Ķ AB 2583 Page 1 Date of Hearing: April 23, 2012 ASSEMBLY COMMITTEE ON TRANSPORTATION Bonnie Lowenthal, Chair AB 2583 (Blumenfield) - As Amended: April 9, 2012 SUBJECT : Alternatively fueled vehicles: state fleet: public parking. SUMMARY : Requires the Department of General Services (DGS) and the California Department of Transportation (Caltrans) to increase use of and infrastructure support for alternatively fueled vehicles (AFVs). Specifically, this bill : 1)Requires DGS to purchase new vehicles that are alternatively fueled according to the following schedule: a) 50% of all new vehicles purchased beginning January 1, 2013; and, b) 100% of new vehicles purchased beginning January 1, 2015. 2)Exempts from this provision types of vehicles for which alternatively fueled vehicles are not available. 3)Requires DGS to encourage the operation of alternatively fueled state vehicles on the alternative fuel that the vehicle was designed for. 4)Requires DGS to encourage develop commercial infrastructure for alternative fuel pumps and charging stations at or near state vehicle fueling or parking sites. 5)Requires DGS to work with other public agencies to incentivize and promote state employee operation of alternatively fueled vehicles through preferential or reduced-cost parking, access to charging, or other means. 6)Authorizes DGS to provide grants or enter into interagency agreements to implement the requirements of this bill. 7)Defines "alternatively fueled vehicles" as light-, medium-, and heavy-duty vehicles that reduce petroleum usage and related emissions by using advanced technologies and fuels, AB 2583 Page 2 including, but not limited to, hybrid, plug-in hybrid, battery electric, natural gas, or fuel cell vehicles. 8)Requires DGS and Caltrans to develop and implement advanced technology vehicle parking incentive programs in DGS-operated public parking facilities with 50 spaces or more and Caltrans-operated park and ride lots to incentivize the purchase and use of AFVs in the state. 9)Requires the parking incentive programs developed by DGS and Caltrans to provide meaningful, tangible benefits to AFV drivers, and allows these incentives to include preferential spaces, reduced fees, and fueling infrastructure for AFVs that use these parking facilities or park and ride lots. EXISTING LAW : 1)Establishes the Global Warming Solutions Act of 2006, requiring the Air Resources Board (ARB) to establish a statewide greenhouse gas (GhG) emissions limit and to reduce GhG emissions to 1990 levels. 2)Establishes DGS as the business manager for the state, offering centralized procurement of goods, services and real estate; property management; and fleet administration, among other things. DGS is authorized to conduct procurements on behalf of local governments and other public entities as a means of reducing state and local government costs through the leveraged purchasing power gained because of a larger buying pool. 3)Requires all new state fleet purchases of passenger vehicles and light duty trucks, powered solely by internal combustion engines utilizing fossil fuels, to meet the fuel economy standard established by DGS and California Energy Commission (CEC) on or after January 1, 2008. 4)Requires the Secretary of State and Consumer Services, in consultation with DGS and other appropriate agencies that maintain or purchase vehicles, to develop and implement a plan with the goal of improving use of alternative fuels, synthetic lubricants, and fuel-efficient vehicles by reducing or displacing the consumption of petroleum products by the state fleet when compared to 2003 consumption levels. AB 2583 Page 3 a) Requires that the plan be submitted to the Legislature and the Governor. b) Requires that the plan implement the following schedule: i. 10% reduction or displacement by January 1, 2012; and, ii. 20% reduction or displacement by January 1, 2020. 1)Requires DGS to provide the Department of Finance (DOF) and the Legislature a progress report on their efforts to meet the overall goals of the Plan beginning on April 1, 2010, and annually thereafter and that the progress report be published on DGSs Internet Web site. FISCAL EFFECT : Unknown COMMENTS : According to the author's office, "California has a goal that by 2025 zero-emission or plug-in hybrid vehicles will account for 15%, or one in seven, new cars sold in California. If achieved, having this number of AFVs on California roadways is expected to reduce vehicular GhG emissions by 80% by 2050. According to the California Air Resources Board (CARB), in order to meet the 2050 GhG goal, vehicles across the state will need to be primarily composed of advanced technology vehicles such as electric and fuel cell vehicles by 2035. By establishing new alternative fuel targets for California's state fleet, as well as incentivizing and promoting state employee operation of AFVs through preferential or reduced-cost parking, access to charging, or other means, it is expected that the state will not only reduce emissions from the state-owned fleet, but will also help reduce barriers that currently restrict consumers from buying AFVs. Background . DGS procures vehicle fleet purchases on behalf of state agencies. There are existing federal and state laws, and state executive orders, directing DGS to green the state fleet. DGS has met or exceeded those requirements, which are discussed below. AB 2583 Page 4 The Federal Energy Policy Act (EPA) requires that 75% of new vehicle purchases, with certain exceptions, be capable of running on alternative fuels. DGS has been compliant with the EPA since its enactment in 1992 and, in some years, already exceeded the 75% requirement. According to DGS, in fiscal year 2009-10, 99% of new vehicle purchases were AFVs, but 106 vehicles were exempt from the EPA definition of AFV, which does not include hybrid or hybrid electric vehicles. Based on the EPA definition of AFV, DGS was 86% compliant with the law. This bill would include hybrid and plug-in hybrid vehicles in the definition of an AFV. California has taken measures to reduce GhG emissions from state vehicles and encourage the use of AFVs. In 2005, the Governor issued EO S-3-05 and established the GhG reduction targets to: by 2010, reduce GHG emissions to 2000 levels; by 2020, reduce GHG emissions to 1990 levels; by 2050, reduce GHG emissions to 80 percent below 1990 levels. AB 32 (Nuņez), Chapter 488, Statutes of 2006, established the Global Warming Solutions Act of 2006, which required CARB to establish a statewide GhG emissions limit and reduce GhG emissions to 1990 levels. AB 236 (Lieu), Chapter 593, Statutes of 2007, established the goal of reducing or displacing the consumption of petroleum products by the state fleet when compared to the 2003 consumption levels based on the following schedule: 10% by January 1, 2012, and 20% by January 1, 2020. As a result of these measures, DGS is currently working to expand the use of AFVs on alternative fuels. This bill requires DGS to encourage, to the extent feasible, the operation of state AFVs on the alternative fuel for which the vehicle is designed and the development of commercial infrastructure for alternative fuel pumps and charging stations at or near state vehicle fueling or parking sites. DGS is currently implementing this bill's provisions. DGS was awarded United States Department of Energy and CEC grants to establish approximately 75 new E85 (flexible fuel from 100% gasoline to 85% gasoline/15% ethanol) fueling locations statewide. To date, 15 E85/biodiesel locations have been completed. DGS recently installed 24 electric vehicle (EV) charging stations at five state parking facilities in Sacramento and is applying for grants to install additional EV charging stations. This bill requires DGS to work with other public agencies to AB 2583 Page 5 incentivize state employee use of AFVs and authorizes DGS to provide grants or enter into interagency agreements to implement the provisions of this bill. DGS has indicated that they already offer state employees incentives for using AFVs and will be developing a policy and expanding those efforts in the next few months. DGS is also expecting to enter into an interagency agreement for an outreach and marketing campaign to promote AFV usage. This bill requires DGS to purchase AFVs at a rate of 50% of new vehicle purchases beginning January 1, 2013, and 100% of new vehicle purchases beginning January 1, 2015. This bill would mandate state agencies to purchase AFVs, beginning in 2015, for light-, medium-, and heavy-duty vehicles. Currently, state agencies have the option of buying an AFV. While this bill exempts AFVs if certain types of vehicles are unavailable, certain agencies whose work is related to law enforcement, transportation, and construction may wish to purchase vehicles that are not AFVs. According to Caltrans' website, the department has taken a number of proactive steps toward greater use of AFV by purchasing and utilizing AFVs and developing supporting AFV infrastructure. The Caltrans Fleet Greening Program began as a five-year plan in August 2000 to reduce emissions from the Caltrans fleet, stay ahead of emerging regulations, and set the example for the use of emerging, clean air technologies. Today Caltrans' policies continue to promote an efficient fleet mix and use of efficient, low emission vehicles to lower Caltrans' use of petroleum as well as reduce emissions of criteria air pollutants and GhGs. Through a combination of regulation compliance, state purchasing policies, and innovative programs Caltrans uses hybrid passenger vehicles, solar-powered equipment, propane-fueled vehicles. Caltrans also indicates that it operates two hydrogen demonstration vehicles and established various E-85 fuel ethanol demonstration projects. According to CALSTART, "California's state fleet should clearly reflect the state's clean air and advanced vehicle mandates. AB 2583 would transition the state fleet toward clean vehicles and ensure that state-owned garages support and encourage the use of these vehicles. "The benefits of proactively transitioning the state fleet from status-quo 'dirty' petroleum and toward cleaner alternatives AB 2583 Page 6 would be significant. In addition to directly reducing emissions, the bill would show real commitment on the part of California to meet its climate and air quality targets accelerate clean transportation technologies by supporting crucial early markets for alternative fuels. Moreover, in an era of high and volatile fuel prices, reducing dependence on petroleum will yield direct fuel cost savings for California. Double-referral . This bill was heard in the Business, Professions and Consumer Protection Committee and was passed with 9 votes in favor and none opposed. Previous legislation : AB 236 (Lieu) Chapter 593, Statutes of 2007 revised current policies regarding the purchase of vehicles for state and local government fleets in order to increase fuel efficiency and the use of alternative fuels. AB 32 (Nuņez), Chapter 488, Statutes of 2006, established the Global Warming Solutions Act of 2006, which requires ARB to establish a statewide GhG emissions limit and to reduce GhG emissions to 1990 levels. AB 2264 (Pavley), Chapter 767, Statutes of 2006, which required DGS, in consultation with the State Energy Resources Conservation and Development Commission to establish a minimum fuel economy standard for the purchase of all state fleet vehicles powered by internal combustion engines utilizing fossil fuels, and mandated DGS and any other state entity, as defined, to purchase new state passenger and light duty vehicles in accordance with that minimum fuel economy standard. AB 1357 (Ruskin) of 2005, would have required the Director of DGS to compile and maintain information on the number of bifuel natural gas and bifuel propane vehicles purchased or leased by the state during the year, the total number owned or leased as of December 31 of each year, and the total amount of fuel used during the year by those vehicles, itemized by type of fuel, as of December 31 of each year. That bill was vetoed by the Governor. AB 1660 (Pavley), Chapter 580, Statutes of 2005, enacted the California Energy-Efficient Vehicle Group Purchase Program to encourage the purchase of energy-efficient vehicles by local and state agencies through a group-purchasing program that uses the purchasing leverage of state and local agencies to lower the AB 2583 Page 7 purchase price of those vehicles. REGISTERED SUPPORT / OPPOSITION : Support CALSTART Opposition None on file Analysis Prepared by : Victoria Alvarez / TRANS. / (916) 319- 2093