BILL ANALYSIS Ó
SENATE TRANSPORTATION & HOUSING COMMITTEE BILL NO: sb 1204
SENATOR MARK DESAULNIER, CHAIRMAN AUTHOR: lara
VERSION: 3/24/14
Analysis by: Erin Riches FISCAL: yes
Hearing date: April 1, 2014
SUBJECT:
Vehicle emissions reductions: California Clean Truck, Bus, and
Off-Road Vehicle and Equipment Technology Program
DESCRIPTION:
This bill creates a California Clean Truck, Bus, and Off-Road
Vehicle and Equipment Technology Program to fund development,
demonstration, pilot projects, and commercial deployment of
zero- and near-zero-emission truck, bus, and off-road vehicle
and equipment technologies. This bill provides that the program
shall be funded from the Greenhouse Gas Reduction Fund, and
shall prioritize projects located in disadvantaged communities.
ANALYSIS:
California Global Warming Solution Act of 2006 and Greenhouse
Gas Reduction Fund
AB 32 (Núñez), Chapter 488, Statutes of 2006, requires the state
Air Resources Board (ARB) to develop a plan of how to reduce
emissions to 1990 levels, by 2020. AB 32 also requires ARB to
ensure that greenhouse gas (GHG) emission reduction requirements
and programs, to the extent feasible, direct public and private
investment toward the most disadvantaged communities in the
state. It authorizes ARB to adopt a schedule of fees to be paid
by GHG emission sources regulated under AB 32 and deposited into
the Greenhouse Gas Reduction Fund (commonly known as
cap-and-trade), available upon appropriation by the Legislature
to carry out AB 32 requirements.
SB 535 (De Leon), Chapter 830, Statutes of 2012 requires the
Department of Finance, when developing the three-year investment
plan for cap-and-trade monies, to allocate 25 percent of these
funds to projects that provide benefits to disadvantaged
communities, and to allocate a minimum of 10 percent of
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available cap-and-trade monies to projects located within
disadvantaged communities. The bill outlines a process to
identify these communities and allows for periodic modification
as necessary.
Air Quality Improvement Program (AQIP)
AB 118 (Núñez, Chapter 750, Statutes of 2007) establishes the
Air Quality Improvement Program (AQIP), administered by ARB in
consultation with local air districts. This program is funded
through surcharges on vehicle registration fees, a portion of
vessel registration fees, a portion of the Smog Abatement Fee
(paid to register vehicles less than six model years old and
therefore exempt from smog check), and an increase in the fee
for identification plates for various types of vehicles, such as
farm trailers and logging vehicles, operated on public roads.
This program provides competitive grants to fund projects to
improve the air quality impacts of alternative fuels and
vehicles, vessels, and equipment technologies. AQIP encompasses
several programs, including the Hybrid and Zero-Emission Truck
and Bus Voucher Incentive Project (HVIP). HVIP, which is
administered by ARB and its contractor, CALSTART, provides
vouchers to California fleet owners to help purchase hybrid and
zero-emission trucks and buses.
Alternative and Renewable Fuel and Vehicle Technology Program
(ARFVTP)
AB 118 (Núñez, Chapter 750, Statutes of 2007) also establishes
the Alternative and Renewable Fuel and Vehicle Technology
Program (ARFVTP), administered by the state Energy Commission.
This program provides funding for development and deployment of
alternative and renewable fuels and advanced transportation
technologies to help attain the state's climate change goals.
Eligible projects include, for example, development,
improvement, and production of alternative and renewable
low-carbon fuels; improvement of light-, medium-, and heavy-duty
vehicle technologies; and expansion of infrastructure connected
with existing fleets, public transit, and transportation
corridors.
This bill creates a California Clean Truck, Bus, and Off-Road
Vehicle and Equipment Technology Program, to be administered by
ARB in conjunction with the state Energy Commission. This bill
provides that the program shall be funded from the Greenhouse
Gas Reduction Fund, and shall prioritize projects located in
SB 1204 (LARA) Page 3
disadvantaged communities.
Specifically, this bill requires the California Clean Truck Bus,
and Off-Road Vehicle and Equipment Program to fund:
Development, demonstration, and pilot deployment of zero- and
near-zero-emission medium- and heavy-duty truck technology
projects.
Pilot deployment of large numbers of zero- and
near-zero-emission buses to demonstrate the impact of clean
buses in disadvantaged communities, the difficulty of transit
operators to afford clean buses, and the possibility of
finding applications for these technologies in other
heavy-duty vehicles.
Development, demonstration, and pilot deployment of zero- and
near-zero-emission technologies to be used in off-road
vehicles and equipment, including port equipment, agricultural
equipment, and marine and rail equipment.
Development of commercially available zero- and
near-zero-emission trucks, buses, and off-road vehicles and
equipment using streamlined purchase incentives pursuant to
HVIP.
This bill requires ARB, as part of this program, to develop
solicitations in consultation with transit operators to fund at
least two large-scale zero- or near-zero-emission bus pilot
deployment projects of between 10 and 40 buses, to be located in
or near disadvantaged communities.
This bill also requires ARB to create a multiyear framework and
plan for HVIP incentives, as follows:
Focus on providing incentives for zero- and near-zero-emission
medium- and heavy-duty vehicles as they become commercially
available.
Structure incentives to drive acquisition volumes by reducing
payback times for these vehicles.
Provide long-term certainty about incentives while remaining
flexible and open to new technologies.
Examine opportunities to link HVIP vehicle funding with
infrastructure funding to provide coordinated funding for both
vehicles and related infrastructure.
Provide for sufficient HVIP incentives for plug-in and
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zero-emission vehicles in disadvantaged communities to
increase sales of the cleanest vehicles in communities where
they are needed most.
COMMENTS:
1.Purpose . The author notes that 40 percent of California's
contribution to climate pollution comes from cars, trucks,
trains, and other mobile sources. While technology for
light-duty cars has progressed significantly, making it widely
available for commercial use, technology for heavy-duty trucks
and buses is severely lagging. It is essential to reduce GHG
emissions and improve air quality in areas that suffer
disproportionately from air pollution, such as those near
ports or major transportation corridors. The region
surrounding the ports of Los Angeles and Long Beach, for
example, ranks as one of the most polluted in the country.
The author states that this bill will make it easier for truck
owners to transition to zero- and near-zero technology and
improve the health of millions of Californians who live in
communities that are burdened daily by transportation-related
pollution.
2.Why a new program ? As described above, the Energy
Commission's ARFVTP provides funding for development and
deployment of alternative and renewable fuels and advanced
transportation technologies, while ARB's HVIP helps California
fleet owners purchase hybrid and zero-emission trucks and
buses. The author notes that creating a new program is
appropriate because this bill allows for a broader range of
projects than AQIP and ARFVTP, and helps further prioritize
investment in heavy-duty technology. It is not entirely
clear, however, what projects are eligible for the new program
that are not currently eligible for AQIP or ARFVTP.
3.Other issues to consider . As the bill moves forward, the
author may wish to consider addressing the following issues:
This bill requires ARB to create a "multiyear framework
and plan" for HVIP. It may be appropriate to provide ARB
flexibility to evaluate this plan each year pursuant to
program funding levels and the state of emerging
technologies.
This bill requires ARB, in the multiyear HVIP plan, to
"provide long-term certainty about incentives." This
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requirement appears to imply that ARB must establish
long-term funding for these incentives. It may be
appropriate to provide ARB flexibility to evaluate and
adjust the HVIP plan each year pursuant to program funding
levels.
This bill requires ARB to fund "near-zero-emission"
technologies. It may be appropriate to define
"near-zero-emission."
1.Private fleets . The California Bus Association has taken a
"support if amended" position. The association states that
making private charter-party carriers eligible for the program
created by this bill would help drive investment in the
private as well as public sector.
2.Double-referral . The Rules Committee has referred this bill
to both this committee and to the Environmental Quality
Committee. Therefore, if this bill passes this committee, it
will be referred to the Environmental Quality Committee.
RELATED LEGISLATION:
This committee will hear two related bills at today's hearing:
SB 913 (DeSaulnier) requires ARB and the Bureau of
Automotive Repair to cooperate in issuing a specified
number of vouchers through EFMP and the Consumer Assistance
Program to retire high-polluting cars, and a specified
number of vouchers through EFMP to replace high-polluting
cars.
SB 1275 (De León) requires ARB to expand EFMP to provide
for ridesharing and car-sharing vouchers as an alternative
to vehicle-replacement vouchers. It also requires ARB to
adopt a funding plan for projects under AQIP, adopt
specified revisions to AQIP, and establish programs to
increase access to and direct benefits from electric
transportation for disadvantaged and low- and
moderate-income communities.
POSITIONS: (Communicated to the committee before noon on
Wednesday, March 26,
2014.)
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SUPPORT: American Lung Association of California
Breathe California
CALSTART
Center for Transportation and the Environment
Communities for a Better Environment
Coalition for Clean Air
Environment California
Environmental Defense Fund
Greenlining Institute
Natural Resources Defense Council
Sierra Club California
OPPOSED: California Chamber of Commerce