BILL ANALYSIS Ó
AB 284
Page 1
Date of Hearing: April 29, 2013
ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE
Steven Bradford, Chair
AB 284 (Quirk) - As Amended: April 24, 2013
SUBJECT : Energy: Road to 2050 Board
SUMMARY : Requires the California Energy Commission (CEC) to
convene a board to report on milestones and scenarios to achieve
the state's 2050 greenhouse gas (GHG) emission reduction
requirement. Specifically, this bill :
a)Requires the CEC to convene a board comprised of high level
representatives from:
1) CEC
2) California Public Utilities Commission (PUC)
3) State Air Resources Board (ARB)
4) California Environmental Protection Agency (CalEPA)
5) California Independent System Operator (CAISO)
6) Two members appointed by the Speaker of the Assembly.
7) Two members appointed by the Senate Committee on Rules.
a)Requires the Board, by January 1, 2015 and every four years
after, to prepare and adopt a "Road to 2050" Report to be used
on an advisory basis to guide decision making processes and
policies at the local and state level to ensure those
processes consider implications for meeting the 2050 goals.
1) Requires the report to contain the following:
2) An overview of the overall reduction in GHG emissions as
a result of energy and environmental policies to date.
3) Consistent metric integration among state agencies to
ensure the analysis of information in the report is
reliable and determines cost-effectiveness.
4) Milestones to represent the progress made towards the
2050 goal and a determination if a change in course of
action is appropriate.
5) Alternative scenarios describing the best possible
roadmap to achieve the 2050 goal in the most cost-effective
manner. The scenarios are to be based on policies currently
in effect and existing technologies and infrastructures at
the time of the report; contain separate roadmaps to
determine the best processes toward the 2050 goal; include
a marginal cost curve analysis to better assess the
cost-effectiveness of each given scenario.
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a)Authorizes the 2050 Board to contract with an independent
research group to prepare the report.
b)Requires the 2050 Board to hold a public hearing every two
years regarding the 2050 Report.
EXISTING LAW
1)Requires the CEC to assess energy infrastructure trends and
issues facing California and develop and recommend energy
policies for the state to address and resolve such issues as
part of the biennial Integrated Energy Policy Report (IEPR).
(Public Resources Code 25300)
2)Pursuant to the California Global Warming Solutions Act (AB
32), requires the Air Resources Board (ARB) to adopt a
statewide GHG emissions limit equivalent to 1990 levels by
2020 and to adopt rules and regulations to achieve maximum
technologically feasible and cost-effective GHG emission
reductions.
(Health and Safety Code 38500)
3)Requires electric utilities and certain other retail sellers
of electricity to procure eligible renewable energy resources
to meet the following portfolio targets:
a) 20 percent on average from January 1, 2011 to December
31, 2013.
b) 25 percent by December 31, 2016.
c) 33 percent by December 31, 2020 and each year
thereafter.
(Public Utilities Code 399.11)
FISCAL EFFECT : Unknown
COMMENTS :
1)Author's statement : "Strategies to achieve AB 32 goals have
varied in scope, length and complexity. One strategy has been
the creation of different programs to incentivize the use of
energy efficiency, alternative energy and alternative fuel
technologies. However, there lacks a state-wide strategic or
cohesive structure to encourage communication and coordination
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on AB 32-associated programs.
"Furthermore, the implementation of California's ambitious
energy and environmental goals are the responsibility of a
group of fragmented state agencies that lack a comprehensive
plan to effectively move forward and synchronize to ensure
maximum efficiency.
"According to a recent Legislative Analyst's Office (LAO)
report, Energy Efficiency and Alternative Energy Programs,
"the state currently lacks a comprehensive framework that
fully coordinates these activities to help ensure that the
state's goals are being met in the most cost-effective
manner."
"Furthermore, a December 2012 report by the Little Hoover
Commission, Rewiring California: Integrating Agendas for
Energy Reform, states, "the state lacks the ability to impose
order on the multitude of proceedings that determine how these
policies unfold, order which is essential to ensuring the
state maximizes progress toward each of its policy goals."
2)Executive Order S-3-05 . In 2005, Governor Schwarzenegger
issued an Executive Order addressing climate change causes and
impacts. In this Executive Order the Governor ordered the
following:
"1. That the following greenhouse gas emission reduction
targets are hereby established for California: 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; and
2. That the Secretary of the California Environmental
Protection Agency ("Secretary") shall coordinate oversight of
the efforts made to meet the targets with: the Secretary of
the Business, Transportation and Housing Agency, Secretary of
the Department of Food and Agriculture, Secretary of the
Resources Agency, Chairperson of the Air Resources Board,
Chairperson of the Energy Commission, and the President of the
Public Utilities Commission; and
3. That the Secretary shall report to the Governor and the
State Legislature by January 2006 and biannually thereafter on
progress made toward meeting the greenhouse gas emission
targets established herein; and
4. That the Secretary shall also report to the Governor and
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the State Legislature by January 2006 and biannually
thereafter on the impacts to California of global warming,
including impacts to water supply, public health, agriculture,
the coastline, and forestry, and shall prepare and report on
mitigation and adaptation plans to combat these impacts; and
5. That as soon as hereafter possible, this Order shall be
filed with the Office of the Secretary of State and that
widespread publicity and notice be given to this Order."
In August 2012 Governor Brown announced the launch of a new
website, "Climate Change: Just the Facts," to provide facts
and data on global warming on the science and data of climate
change.
3)Cleveland National Forest Foundation et al. v. San Diego
Association of Governments et al. In November 2011, the
Cleveland National Forest Foundation and Center for Biological
Diversity filed a lawsuit against the San Diego Association of
Governments (SANDAG), primarily challenging SANDAG's approval
of its 2050 Regional Transportation Plan/Sustainable
Communities Strategy (RTP/SCS) and certification of its Final
Environmental Impact Report (FEIR) for the 2050 RTP/SCS,
alleging violations of the California Environmental Quality
Act (CEQA). A separate case against SANDAG was filed at the
same time by Citizens for Responsible Equitable Environmental
Development (CREED-21) and the Affordable Housing Coalition of
San Diego County, also challenging SANDAG's 2050 RTP/SCS and
FEIR. These two (2) cases were consolidated by the court.
Additionally, the court granted requests to add The Sierra
Club and the California Attorney General's request to join as
interveners.
In its ruling on December 3, 2012, the Superior Court of the
County of San Diego stated:
"First, although SANDAG acknowledges SB 375 mandates a
"sharper focus on reducing GHG emissions" the EIR is
impermissibly dismissive of Executive Order S-03-05. SANDAG
argues that the Executive Order does not constitute a 'plan'
for GHG reduction, and no state plan has been adopted to
achieve the 2050 goal. The EIR therefore does not find the
RTP/SCS's failure to meet the Executive Order's goals to be a
significant impact. This position fails to recognize that
Executive Order S-3-05 is an official policy of the State of
California, established by a gubernatorial order in 2005, and
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not withdrawn or modified by a subsequent (and predecessor)
governor. Quite obviously it was designed to address an
environmental objective that is highly relevant under CEQA
(climate stabilization)." [emphasis added]
The court found in favor of the petitioners and stated that
"the real focal point of this controversy is whether the EIR
is in conformance with a series of state policies enunciated
by the legislative and executive branches since 2005 relating
to greenhouse gases. Governor Schwarzenegger issued, in 2005,
Executive Order S-03-05, which for the first time set a state
goal of reducing greenhouse gas emissions. This Executive
Order gave rise to the Global Warming Solutions Act of 2006
(AB 32), which is codified at H&S Code section 38500 et seq."
While this court's ruling is not binding on any other court it
does set a precedent that could affect the decisions made by
other courts.
4)Follow on to Visions of 2050? In 2011 a report, California's
Energy Future - The View to 2050 was sponsored by the
California Council on Science and Technology and funded by the
CEC and the Stephen Bechtel Fund.
The View to 2050 report assessed technology requirements for
reducing GHG emissions in California to 80 percent below 1990
levels by 2050, a target established pursuant to Executive
Order S-3-05. This report identified four key actions can
feasibly reduce California greenhouse gas emissions to roughly
60 percent below 1990 levels (150 MtCO2e/yr) by 2050:
a) Aggressive efficiency measures for buildings, industry
and transportation to dramatically reduce per capita energy
demand.
b) Aggressive electrification to avoid fossil fuel use
where technically feasible.
c) Decarbonizing electricity supply while doubling
electricity production and developing zero-emissions load
balancing approaches to manage load variability and
minimize the impact of variable supply for renewables like
wind and solar.
d) Decarbonizing the remaining required fuel supply where
electrification is not feasible.
The report went on to state that:
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"We could further reduce 2050 greenhouse gas emissions to 80
percent below 1990 levels with significant innovation and
advancements in multiple technologies that eliminate emissions
from fuels. All of these solutions would require intensive
and sustained investment in new technologies plus innovation
to bridge from the laboratory to reliable operating systems in
relatively short timeframes.
"There are many additional technologies that reduce emissions
from fuels. In combination these could achieve the required
additional emission cuts from 60 to 80 percent. Many require
multiple simultaneous strategies, some are industrially
complex and costly and some are actually offsets, but all of
them require research and innovation.
"Possible breakthrough technologies such as carbon neutral
fuel from sunlight or advances in nuclear power could be game
changers. These would allow us to produce abundant
electricity or fuel with nearly zero emissions."
1) Similar Boards? Similar to the Governor Schwarzenegger's
Order, this bill establishes a high-level board, but with a
slightly different composition.
The author may wish to amend the bill to designate the Chair
of the California Air Resources Board as the lead agency and
include the Agencies and Departments identified in the order.
In so doing, the provisions in this bill would move from its
current location in the Public Resources Code to another
section of the Public Resources Code.
2) Similar but Different? Similar to the Governor
Schwarzenegger's Order, this bill establishes that the
Secretary of CalEPA "shall report to the Governor and the
State Legislature by January 2006 and biannually thereafter
on progress made toward meeting the greenhouse gas emission
targets established herein;"
This bill would require a new separate report, on a four year
reporting schedule. In addition, this new report would be used
to guide key infrastructure decision making processes and
policies at the local and statewide level.
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It is also unclear what is meant by "guide key infrastructure
decisions." As written, this reporting requirement does not
specify which key infrastructure decisions would be guided by
this report. As written this could apply to any of a variety
of actions from electricity transmission and distribution
systems, natural gas infrastructure, energy generation
facilities, water infrastructure, land use planning, and
possibly other types of infrastructure.
As written, this is an advisory document only and does not
bind the decision making of any state or local governing body.
In a recent report by the Legislative Analyst's Office (LAO)
on energy efficiency, the LAO found it difficult to evaluate
effectiveness across all programs and suggested that in order
to ensure the state is expending resources where it can get
the biggest bang for its buck the state should use a
consistent set of evaluation metrics and methods and use a
comparison of programs' marginal costs to help provide a
better understanding of the relative costs and benefits of
various programs.
"While some of the energy efficiency and alternative energy
programs we reviewed have an evaluation component, the
state has not methodically assessed all of these programs.
As such, the state does not currently evaluate the relative
cost-effectiveness of all programs. Such an evaluation
would include a comparison of programs' marginal costs of
achieving the state's energy goals and, thus, would help
provide program feedback for policymakers. In addition,
given that there are multiple departments involved in
administering the various programs, departments have
developed their own set of evaluation metrics and methods
specific to their programs-making it difficult to compare
the relative effectiveness of one program to another.
"Thus, it is currently difficult for the Legislature to
ensure that the state is expending resources where it can
get the biggest bang for its buck. The existence of common
evaluation methods would help the Legislature better
understand the investments it is making in energy
efficiency and alternative energy and what the impact would
be if it decided to reduce or increase its investments in
particular programs. This is particularly important given
that the Legislature will need to decide how to invest the
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additional funding that will be available from the
cap-and-trade auctions and Proposition 39."
This bill seeks to establish a common set of metrics and to
provide a marginal cost assessment of the "Road to 2050" to
help inform policy makers and program implementers. However,
using a marginal cost assessment would relieve the need to
develop alternate scenarios as all programs would be assessed
in the same manner.
The author may wish to revise the language in the bill and
instead codify the reporting requirement in S-3-05, while
maintaining that the report is for advisory purposes only, and
include the provisions proposed for the Road to 2050 report in
the currently required report, with the exception of the
scenario provisions.
3) Need for an independent contractor? By moving these
provisions to the ARB the bill will no longer require an
independent contractor provision as ARB has mechanisms to
contract for these services. The specific investigations
regarding best processes and methods can be incorporated
into the reporting requirements.
25229. 71090 (a) To ensure that the interests of the people
of California are served, the commission Chair of the
California Air Resource Board shall convene the Road to 2050
Board consisting of all of the following:
(1) A high-level representative from the commission.
(2) A high-level representative from the Public Utilities
Commission.
(3) A high-level representative from the State Air Resources
Board.
(4) A high-level representative from the California
Environmental Protection Agency.
(5) A high-level representative from the Independent System
Operator.
(6) Two members appointed by the Speaker of the Assembly.
(7) Two members appointed by the Senate Committee on Rules.
(1) the Secretary of the Business, Transportation and
Housing Agency,
(2) Secretary of the Department of Food and Agriculture,
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(3) Secretary of the Resources Agency,
(4) Chair of the Energy Commission,
(5) President of the Public Utilities Commission.
(b) For the purposes of this section, "2050 goal" means the
goal of reducing emissions of greenhouse gases by 80 percent
from 1990 emission levels by 2050.
25229 (b) The board shall do both of the following:
(1) (A) On or before January 1, 2015, and on or before January
1 every four years thereafter, the board shall prepare and
adopt, the Road to 2050 Report containing findings that are
used, on an advisory basis, to guide key infrastructure
decisionmaking processes and policies at the local and
statewide level to ensure those processes adequately consider
implications for meeting the 2050 goals.
(B) The report shall contain all of the following:
(i) An overview of the overall reduction in emissions of
greenhouse gases as a result of California's energy and
environmental policies to date.
(ii) Consistent metric integration among the state agencies to
ensure the analysis of the information included in the report
is reliable and determines cost-effectiveness.
(iii) Milestones to represent the progress needed to achieve
the 2050 goal, an evaluation of what is reasonably possible,
and if a change in course of action is appropriate.
(iv) Alternative scenarios describing the best possible
roadmap to achieve the 2050 goal in the most cost-effective
manner.
(I) The scenarios shall be based on policies currently in
effect and existing technologies and infrastructures at the
time of the report.
(II) The scenarios shall contain separate roadmaps to
determine the best processes toward the 2050 goal.
(III) The scenarios shall include a marginal cost curve
analysis to better assess the cost-effectiveness of each given
scenario.
(C) The board shall hold a public meeting, on a biennial
basis, for the preparation of the report.
(D) The board shall submit to the Legislature, notwithstanding
Section 10231.5 of the Government Code, and pursuant to
Section 9795 of the Government Code, the report and identify
statutory changes, policy gaps, limitations in statutes, or
conflicting policies among state agencies that are needed to
optimize the objectives of the state's energy and
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environmental policies.
(E) The board may contract with an independent research group
to prepare the report.
(2) Contract with an independent research group to focus on a
study to determine the best process for meeting the 2050 goal
to include all of the following:
(A) The best process for reducing carbon emissions from
electrical generation that ensure cost-effectiveness and
reliability.
(B) Methods to reduce emissions of greenhouse gases from
homes, farms, and industrial and commercial structures.
(C) Emission reductions from sources of transportation.
70091 (a) The Chair shall report to the Governor and the State
Legislature, notwithstanding Section 10231.5 of the Government
Code, and pursuant to Section 9795 of the Government Code, by
January 2016 and biennially thereafter on the impacts to
California of global warming, including impacts to water
supply, public health, agriculture, the coastline, and
forestry, and shall prepare and report on mitigation and
adaptation plans to combat these impacts.
(b) The report shall contain all of the following:
(1) An overview of the overall reduction in emissions of
greenhouse gases as a result of California's environmental
and energy policies to date.
(2) Milestones to represent the progress needed to achieve
the 2050 goal, an evaluation of what is reasonably
possible, and if a change in course of action is
appropriate.
(3) Descriptions of all programs and policies using
currently available technologies to achieve the 2050 goal.
(4) The best process for reducing carbon emissions from
electrical generation that ensure cost-effectiveness and
reliability.
(5) Methods to reduce emissions of greenhouse gases from
homes, farms, and industrial and commercial structures.
(6) Emission reductions from sources of transportation.
(a) The report shall be used establish consistent metrics to
be used for quantifying greenhouse gas emissions and
greenhouse gas emission reductions and assessing the costs
and benefits of each emission reduction program.
(1) The report shall be based on policies currently in
effect based on existing infrastructures and technologies.
(2) The report shall include a marginal cost curve analysis
on each program to provide an assessment of the cost
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effectiveness of the program.
(3) An identification of any statutory changes, policy gaps,
limitations in statutes, or conflicting policies among
state agencies that are needed to or prevent the ability to
optimize the objectives of the state's energy and
environmental policies
(a) The report shall be used on an advisory basis to guide
key infrastructure decisionmaking processes and policies at
the local and statewide level.
(b) The Chair shall convene at least one public meeting to
take public comments on the report.
REGISTERED SUPPORT / OPPOSITION :
Support
California Municipal Utilities Association (CMUA)
East Bay Municipal Utility District (EBMUD)
Sacramento Municipal Utility District (SMUD)
California Energy Efficiency Industry Council
Coalition of California Utility Employees (CCUE) (if amended)
California State Association of Electrical Workers (if amended)
Opposition
None on file
Analysis Prepared by : Susan Kateley / U. & C. / (916)
319-2083