Amended in Assembly April 8, 2013

California Legislature—2013–14 Regular Session

Assembly Bill No. 153

Introduced by Assembly Member Bonilla

January 18, 2013

An act to add Part 8 (commencing with Section 38600) to Division 25.5 of the Health and Safety Code, relating to greenhouse gases.

LEGISLATIVE COUNSEL’S DIGEST

AB 153, as amended, Bonilla. California Global Warming Solutions Act of 2006: offsets.

The California Global Warming Solutions Act of 2006 requires the State Air Resources Board to adopt regulations to require the reporting and verification of emissions of greenhouse gases and to monitor and enforce compliance with the reporting and verification program, and requires the state board to adopt a statewide greenhouse gas emissions limit equivalent to the statewide greenhouse gas emissions level in 1990 to be achieved by 2020. The act requires the state board to adopt rules and regulations in an open public process to achieve the maximum technologically feasible and cost-effective greenhouse gas emission reductions. The act authorizes the state board to include the use of market-based compliance mechanisms.

This bill, if the state board uses its authority to include the use of market-based compliance mechanisms, would require the state board, on or before January 1, begin delete 2014 end delete begin insert 2015 end insert , to adopt a specified process for the review and consideration of new offset protocols and, commencing in 2014 and continuing annually thereafter, use that process to review and consider new offset protocols. begin insert The bill would require the state board to adopt guidelines and incentives that prioritize the approval of specified offset protocols. end insert begin insert The bill would require the state board to submit a specified annual report to the Legislature. end insert

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.  

The Legislature finds and declares all of the
following:

(a) The California Global Warming Solutions Act of 2006
(Division 25.5 (commencing with Section 38500) of the Health
and Safety Code) requires the state to reduce greenhouse gas
emissions to 1990 levels by 2020.

(b) On October 20, 2011, the State Air Resources Board adopted
the final cap-and-trade regulation pursuant to the act, to become
effective January 1, 2012, as required by that act, and also adopted
Resolution 11-32 to require that its executive officer develop
implementation documents laying out the process for the review
and consideration of new offset protocols.

(c) The cap-and-trade regulation is part of the state’s global
warming scoping plan and is intended to provide covered entities
under the act the flexibility to seek out and implement the
lowest-cost options to reduce greenhouse gas emissions and will
provide an estimated 20 percent of the emissions reductions
required to achieve 1990 emission levels by 2020, as required by
the act.

(d) The cap-and-trade regulation allows offset credits to be used
as a means by which parties subject to the regulation can lower
their cost to comply with the regulation while still ensuring a
reduction of greenhouse gas emissions and caps the use of offset
credits at no more than 8 percent of a covered entity’s compliance
obligation.

(e) The State Air Resources Board has adopted four compliance
offset protocols for use in the United States that can be used to
certify high-quality offset credits that are additional, real,
permanent, quantifiable, verifiable, and enforceable as required
by the California Global Warming Solutions Act of 2006:
Livestock Manure projects, Urban Forests projects, Ozone
Depleting Substances Destruction projects, and Forests projects.

(f) While a state comprehensive offset protocol review process
would provide more certainty for carbon dioxide offset suppliers
and purchasers to invest in environmentally worthwhile projects
that meet certain criteria under the California Global Warming
Solutions Act of 2006, it is the intent of the Legislature that only
high-quality offset credits that represent rigorously evaluated offset
protocols and that meet the statutory requirements of the act be
allowed for compliance with the cap-and-trade regulation.

SEC. 2.  

Part 8 (commencing with Section 38600) is added to
Division 25.5 of the Health and Safety Code, to read:

 

PART 8.  Certification of Compliance Offsets

 

38600.  

(a) On or before January 1, begin delete 2014 end delete begin insert 2015 end insert , if the state
board has exercised its authority pursuant to subdivision (a) of
Section 38570, the state board, in accordance with Section 38571,
shall adopt a process for the review and consideration of new offset
protocols. The process shall include, but not be limited to, all of
the following:

(1) A schedule, to be posted on the state board’s Internet Web
site, that depicts the timeline for review and consideration of new
offset protocols by the state board. This schedule shall be updated
regularly and at least annually.

(2) An online tracking system that will allow the public to track
the progress of new offset protocols under review and consideration
by the state board.

begin delete

(3) A point of contact at the state board for entities interested
in the process of review and consideration of new offset protocols
by the state board.

end delete begin delete

(4)

end delete

begin insert (3) end insert  An explanation of how the review and consideration process
will accommodate public input and comments on new offset
protocols under consideration.

begin delete

(5)

end delete

begin insert (4) end insert  An explanation of the criteria used for consideration of new
offset protocols, including, but not limited to, a description of the
standards for protocol approval, rejection, and delay. This
description also shall include, to the extent feasible, a description
of the social, environmental, and financial impacts analysis used
in making offset protocol decisions as well as an estimate of
potential supply and expected development costs.

(b) Commencing in 2014, and continuing annually thereafter,
if the state board has exercised its authority pursuant to subdivision
(a) of Section 38570, the state board shall use the process adopted
pursuant to subdivision (a) to review and consider new offset
protocols.

begin insert

(c) The state board shall establish incentives and guidelines
that prioritize the approval of offset protocols, in the following
order, that result in the following:

end insert begin insert

(1) The creation of green jobs in the state and the reduction of
greenhouse gas emissions in the state.

end insert begin insert

(2) Air quality benefits in California communities
disproportionately impacted by air pollution, as determined by
the state board.

end insert begin insert

(3) Cobenefits to public health and the environment anywhere
in the state.

end insert begin insert

(d) (1) Notwithstanding Section 10231.5 of the Government
Code, the state board shall submit to the appropriate committees
of the Legislature an annual report on the status of the offset
supply.

end insert begin insert

(2) A report to be submitted pursuant to paragraph (1) shall be
submitted in compliance with Section 9795 of the Government
Code.

end insert