BILL ANALYSIS Ó
AB 678
Page 1
Date of Hearing: April 27, 2015
ASSEMBLY COMMITTEE ON TRANSPORTATION
Jim Frazier, Chair
AB 678
(O'Donnell) - As Amended April 21, 2015
SUBJECT: Greenhouse gases: Energy Efficient Ports Program
SUMMARY: Requires the Air Resources Board (ARB), in conjunction
with the California Energy Commission (Commission), to develop
the Energy Efficient Ports Program (EEPP) to fund energy
efficiency upgrades and investments at public ports.
Specifically, this bill:
1)Requires ARB, in conjunction with the Commission, to develop
and implement the EEPP to fund efficiency upgrades and
investments at public ports that help reduce emissions of
criteria pollutants, toxic air contaminants, and greenhouse
gases (GHGs).
2)Requires that projects eligible for funding in the EEPP
include, but not necessarily be limited to:
a) Installation of solar technologies at marine terminals,
warehouses, and other freight facilities;
b) Replacement of conventional lighting with light emitting
AB 678
Page 2
diodes;
c) Installation of cold ironing or shorepower equipment and
vessels beyond those required by existing regulations;
d) Deployment of zero- and near-zero emission vehicles and
infrastructure technologies including, but not necessarily
limited to, stationary fuel cells, energy storage and
battery, and battery electric trucks; and,
e) Projects that reduce grid-based energy demand.
3)Requires that ARB, in consultation with the Commission,
develop guidelines for the implementation of the EEPP
consistent with the California Global Warming Solutions Act of
2006 pursuant to AB 32 (Nunez), Chapter 488, Statutes of 2006.
4)Makes monies from the Greenhouse Gas Reduction Fund (GGRF)
available for appropriation by the Legislature to the EEPP.
EXISTING LAW:
1)Required ARB, pursuant to AB 32, to adopt a statewide GHG
emissions limits equivalent to 1990 levels by 2020 and adopt
regulations to achieve maximum technologically feasible and
cost-effective GHG emission reductions.
2)Authorizes ARB, pursuant to AB 32, to use market-based
compliance mechanisms (cap-and-trade) to comply with GHG
reduction regulations.
3)Established the GGRF and requires all moneys, except for fines
AB 678
Page 3
and penalties, collected by ARB pursuant to cap-and-trade be
deposited in the GGRF and available for appropriation by the
Legislature.
4)Established the GGRF Investment Plan and Communities
Revitalization Act, pursuant to
AB 1532 (John A. Pérez), Chapter 807, Statutes of 2012, which
set procedures for the investment of GHG allowance auction
revenues.
5)Requires, pursuant to SB 535, (De Leon), Chapter 830, Statutes
of 2012, that the investment plan allocate a minimum of 25% of
the available moneys in the GGRF to projects that provide
benefits to identified disadvantaged communities and a minimum
of 10% of the available moneys in the GGRF to projects located
within identified disadvantaged communities.
FISCAL EFFECT: Unknown
COMMENTS: According to the author and the sponsor, the Pacific
Merchant Shipping Association (PMSA), the maritime and ports
industry have made an estimated $1.8 billion investment into
infrastructure necessary to implement ARB's shorepower
requirements and, as a result, have kept thousands of tons of
criteria pollutants from entering the atmosphere. As a result,
however, the port's energy demands have grown substantially and,
additionally, there are a number remaining emissions reduction
improvements that still need to be made to help reduce
port-generated emissions.
To help the ports complete these improvements, the author has
introduced AB 678 to fund projects to help California ports
reduce power demands, operating costs, and overhead and
counteract unavoidable energy impacts of At-Berth regulations.
AB 678 is modeled after
SB 1204 (Lara), Chapter 524, Statutes of 2014, that created the
AB 678
Page 4
California Clean Truck, Bus, and Off-Road Vehicle and Equipment
Technology Program to fund development, demonstration, and early
commercial deployment of zero- and near-zero-emission truck,
bus, and off-road vehicle and equipment technologies.
The author notes that while air quality across the state has
improved as a result of stricter air quality laws and
regulations, many areas in the state continue to experience poor
air quality. In their annual air pollution rankings released
this month, the American Lung Association again reported that
the Los Angeles Basin has some of the nation's highest ozone and
fine particle pollution and, as a result, ranked fourth among
metropolitan areas nationwide for short-term spikes in fine
particle pollution. The South Coast Air Quality Management
District, in a study released in late 2014, noted specifically
that black carbon, formaldehyde, nickel, benzene, arsenic, and
dozens of other chemicals are still causing increased cancer
risk, around the ports of Los Angeles and Long Beach due
primarily to heavy diesel emissions associated with port
operations. The author points out that not only are port
operations to blame, the maritime shipping industry itself is
responsible for an estimated 3% of GHG emissions worldwide. He
points out that with the significant expected growth of
international trade, this percentage is expected to increase by
a factor of 2-3 by 2050 if no further action is taken.
In December of 2007, ARB approved an early action item aimed at
reducing the maritime industry's carbon footprint. The
"Airborne Toxic Control Measure for Auxiliary Diesel Engines
Operated on Ocean-Going Vessels At-Berth in a California Port"
Regulation, commonly referred to as the At-Berth Regulation,
that directed vessels docked at-berth in California ports must
use shorepower instead of running their onboard diesel
engines-which has been proven to be a significant source of
emissions and contaminants. Through the use of shorepower, the
ship's power load is seamlessly transferred to a dockside power
supply without disruption to onboard services, thereby
AB 678
Page 5
eliminating the negative side-effects of auxiliary engine
combustion when ships are in port. The regulation specifically
requires at least 50% of the vessels docked at-berth to utilize
shore power in 2014, eventually reaching 70% in 2017, and 80% by
2020. California's ports have, for the most part, come into
compliance with the At-Berth Regulation. The sponsor reports
that not only was the installation of shorepower costly, the
result has been that more and more vessels are demanding larger
quantities of electrical power.
There are a number of programs within ARB and the Commission
that have been created to help reduce emissions including
funding mobile source technology such as on- and off-road
equipment, developing and increasing availability of alternative
fuels, replacing medium- and heavy-duty equipment with cleaner
technology and training the workforce as it relates to the
continued use of these cleaner, advanced technologies. It is
understandable, that California's public ports would therefore
seek an opportunity to utilize emissions reduction funding,
given that ports generate a significant amount of emissions that
result in poor air quality in and around the facilities.
In addition to existing emissions reduction programs, there are
a number of bills that have been introduced this year, including
AB 678, that, if enacted, would place a substantial demand on
limited funding available to support emissions reduction
programs. The Legislature will categorically need to prioritize
in order to maximize benefits and remain within existing funding
limits. By directing monies to projects on or near California's
public ports, as envisioned by AB 678, benefits would include
targeting known emissions sources that have substantial impacts
on air quality and the quality of life for nearby disadvantaged
communities. Further, expending money for programs on and
around California's ports would encourage leveraging of funds
which could increase the return on monies invested.
AB 678
Page 6
Double referral: This bill passed out of the Assembly Natural
Resources Committee on April 13, 2015, with a 9-0 vote.
Related legislation: AB 1074 (C. Garcia) would, among other
things, fund the development of an integrated strategy for
alternative refueling infrastructure. AB 1074 passed out of
this committee on April 13, 2015, with a 16-0 vote and is
awaiting a hearing in the Assembly Appropriations Committee.
AB 1176 (Perea) would, among other things, establish the
Advanced Low-Carbon Diesel Fuels Access Program, administered by
ARB to reduce GHG emissions of diesel motor vehicles by
providing funding for projects that expand advanced low-carbon
diesel fueling infrastructure. AB 1176 is scheduled to be heard
by this committee on April 27, 2015.
AB 904 (Perea) would establish the Clean Reused Vehicle Rebate
Project to provide purchase incentives for clean, used zero- and
near-zero emission light-duty vehicles. AB 904 is scheduled to
be heard by this committee on April 27, 2015.
Previous legislation: SB 1204 (Lara), Chapter 524, Statutes of
2014, created the California Clean Truck, Bus, and Off-Road
Vehicle and Equipment Technology Program to fund development,
demonstration, and early commercial deployment of zero- and
AB 678
Page 7
near-zero-emission truck, bus, and off-road vehicle and
equipment technologies from cap-and-trade Greenhouse Gas
Reduction Fund.
AB 1532 (John A. Pérez), Chapter 807, Statutes of 2012, among
other things, established the GGRF Investment Plan and
Communities Revitalization Act to set procedures for the
investment of GHG allowance auction revenues and authorized a
range of GHG reduction investments.
SB 535 (De Leon), Chapter 830, Statutes of 2012, required the
GGRF investment plan to allocate a minimum of 25 percent of the
available moneys to projects that provide benefits to identified
disadvantaged communities and a minimum of 10% of the available
moneys to projects located within identified disadvantaged
communities.
AB 32 (Nunez), Chapter 488, Statutes of 2006, created the
California Global Warming Solutions Act of 2006 and required ARB
to adopt GHG reduction measures to ensure that statewide
emissions are reduced to 1990 levels by 2020.
REGISTERED SUPPORT / OPPOSITION:
Support
AB 678
Page 8
Pacific Marine Shipping Association (sponsor)
California Infill Builders Federation
South Coast Air Quality Management District
Opposition
None on file
Analysis Prepared by:Victoria Alvarez / TRANS. / (916) 319-2093