BILL ANALYSIS Ó
AB 1191
Page 1
Date of Hearing: May 15, 2013
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Mike Gatto, Chair
AB 1191 (Patterson) - As Amended: March 21, 2013
Policy Committee: Natural
ResourcesVote:16-0
Transportation 9-0
Urgency: State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill requires the California Energy Commission (CEC) to
conduct the transportation forecasting and assessment activities
of the Integrated Energy Policy Report (IEPR) annually beginning
until 2020. This bill also requires the CEC to include an
evaluation of the availability, cost and source of credits
issued under the Air Resource's Board (ARB) Low Carbon Fuel
Standard (LCFS) in the assessment.
FISCAL EFFECT
Unknown increased special fund costs to the CEC, in the hundreds
of thousands of dollars, for increased reporting requirements.
COMMENTS
1)Background. The California Global Warming Solutions Act (AB
32, Núñez-Pavely, Chapter 488, Statutes of 2006) requires ARB
to adopt a statewide greenhouse gas (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.
AB 32 also requires ARB to adopt early action measures to
reduce GHG emissions. The transportation sector is
responsible for approximately 40% of California's total GHG
emissions.
In 2007, Governor Schwarzenegger issued Executive Order
S-01-07, specifying a statewide goal to reduce the carbon
AB 1191
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intensity of California's transportation fuels by at least 10%
by 2020. The order required ARB to consider adopting a LCFS
to implement this goal, either as an early action measure or
in other regulatory proceedings. In 2009, ARB adopted the
LCFS as a regulation to be phased-in beginning in 2010.
The LCFS regulation includes provisions permitting credits to
be generated from certain alternative fuels and requiring that
all fuels, including those used to generate credits,
demonstrate a physical pathway into the state. Credits are
awarded based on fuel performance that exceeds a regulatory
standard. Credits can be banked indefinitely and used for
compliance, sold to other regulated parties, and exported to
other GHG emissions reduction programs. The regulation
requires reviews in 2012 and 2015, including availability of
fuels and economic impacts.
2)Credit check. The proponents of this bill suggest that
sufficient credits may not be available to economically comply
with the LCFS as the targets increase. They point to their
own study as evidence, though ARB disputes the study's
assumptions and conclusions.
This bill poses the CEC as a neutral party to evaluate the
sufficiency of LCFS credits. The subject matter is consistent
with the CEC's existing transportation fuel analysis and
reporting duties.
Analysis Prepared by : Jennifer Galehouse / APPR. / (916)
319-2081