BILL ANALYSIS Ó
AB 33
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Date of Hearing: May 6, 2015
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Jimmy Gomez, Chair
AB
33 (Quirk) - As Amended April 6, 2015
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill establishes the Climate Change Advisory Council
(Council) to make recommendations to the Air Resources Board
(ARB) regarding various greenhouse gas (GHG) emission reduction
strategies, including grid integration, building efficiency, and
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advanced transportation. Specifically, this bill:
1)Establishes the Council, consisting of the following
appointees or their designees:
a) Chair of ARB.
b) President of Public Utilities Commission (PUC).
c) Chair of California Independent System Operator
(CAISO) governing board.
d) Chair of State Water Resources Control Board
(SWRCB).
e) Chair of California Energy Commission (CEC).
2)Requires the Council to complete recommendations for inclusion
in the AB 32 Scoping Plan consisting of:
a) Analyses of various strategies to achieve the
statewide GHG limit, as specified.
b) Economic assessment of the various GHG strategies
using the best available models and data.
c) Analysis of other benefits of the various
strategies.
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3)Provides that the Council's analysis is intended to assist in
establishing state policy and does not change any statute,
regulation, or regulatory decision.
4)Requires ARB to establish consistent metrics for GHG emission
reductions, public health benefits, and cost-effectiveness of
the various strategies identified by the Council.
FISCAL EFFECT:
1)Ongoing annual cost increases of approximately $700,000 (Cost
of Implementation Fund) for the ARB to: 1) design metrics to
quantify GHG reductions; 2) quantify public health benefits;
and 3) measure the cost effectiveness of GHG reductions
strategies.
2)Increased combined annual costs (various special funds) for
PUC, CAISO, SWRCB and CEC of up to $800,000 to perform the
duties required by the bill.
COMMENTS:
1)Purpose. According to the author, the implementation of (AB
32'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 our policies to ensure maximum efficiency. This
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bill will increase the coordination among ARB, CPUC, CEC,
SWRCB, and CAISO by establishing the Climate Change Advisory
Council and directing the Council to analyze various GHG
emissions reduction strategies in the areas of (1) energy
generation; (2) transportation; and (3) energy efficiency.
2)Background. The California Global Warming Solutions Act of
2006 (AB 32) requires ARB to adopt: a) statewide GHG
emissions limit equivalent to 1990 levels by 2020; and b)
regulations, including market-based compliance mechanisms, to
achieve maximum technologically feasible and cost-effective
GHG emission reductions. AB 32 requires ARB to prepare and
approve a scoping plan at five-year intervals.
The first AB 32 scoping plan, adopted by ARB in 2008,
described the specific measures ARB and others must take to
reduce statewide GHG emissions to 1990 levels by 2020.
According to ARB, a total reduction of 80 million metric tons
(MMT), or 16% compared to business as usual, is necessary to
achieve the 2020 limit. Approximately 78% of the reductions
will be achieved through identified direct regulations. ARB
proposes to achieve the balance of reductions necessary to
meet the 2020 limit (approximately 18 MMT) through a
cap-and-trade program that covers an estimated 600 entities.
In May 2014, ARB adopted a scoping plan update. The scoping
plan update discusses the objective of achieving an 80%
reduction by 2050 and the need for a midterm target, but does
not propose or adopt a specific target. According to ARB, the
update defines ARB's climate change priorities for the next
five years and sets the groundwork to reach California's
long-term climate goals.
3)Governor's Executive Order B-30-15. On April 29, 2015, the
Governor issued an executive order to establish a new interim
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statewide greenhouse gas emission reduction target to reduce
greenhouse gas emissions to 40 percent below 1990 levels by
2030 in order to ensure California meets its target of
reducing greenhouse gas emissions to 80 percent below 1990
levels by 2050.
4)2019 Scoping Plan Update. The next scoping plan update will
be in 2019. According to the author, the 2014 update to ARB's
Scoping Plan, did not provide a robust economic assessment of
the strategies implemented to reduce emissions. This bill is
intended to address this shortcoming by requiring the Council
to conduct an economic assessment of the various GHG emissions
reduction strategies using the best available economic models
and data.
As many decisions are currently being considered regarding
reducing GHG emissions beyond 2020, the author may wish to
consider requiring the metrics and analyses provided in the
bill at an earlier date.
Analysis Prepared by:Jennifer Galehouse / APPR. / (916)
319-2081