BILL ANALYSIS                                                                                                                                                                                                    

          |SENATE RULES COMMITTEE            |                         SB 32|
          |Office of Senate Floor Analyses   |                              |
          |(916) 651-1520    Fax: (916)      |                              |
          |327-4478                          |                              |

                                   THIRD READING 

          Bill No:  SB 32
          Author:   Pavley (D), et al.
          Amended:  5/5/15  
          Vote:     21  

           AYES:  Wieckowski, Hill, Jackson, Leno, Pavley
           NOES:  Gaines, Bates

           AYES: Lara, Beall, Hill, Leyva, Mendoza
           NOES: Bates, Nielsen

           SUBJECT:   California Global Warming Solutions Act of 2006:  
                     emissions limit

          SOURCE:    Author

          DIGEST:  This bill requires the California Air Resources Board  
          (ARB) to approve a statewide greenhouse gas (GHG) emissions  
          limit of 80% below the 1990 level of GHG emissions, to be  
          achieved by 2050.


          Existing law, under the California Global Warming Solutions Act  
          of 2006 (Health and Safety Code 38500 et seq.):

          1) Requires the ARB to determine the 1990 statewide GHG  
             emissions level and approve a statewide GHG emissions limit  
             that is equivalent to that level, to be achieved by 2020, and  


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             to adopt GHG emissions reductions measures by regulation.  

          2) Authorizes the ARB to adopt a regulation that establishes a  
             system of market-based declining annual aggregate emission  
             limits for sources or categories of sources that emit GHGs,  
             applicable from January 1, 2012, to December 31, 2020,  

          3) Specifies that the statewide GHG emissions limit remains in  
             effect unless otherwise amended or repealed.

          4) Expresses Legislative intent that the emissions limit be used  
             to maintain and continue GHG emissions reductions beyond  

          5) Requires the ARB to make recommendations to the Governor and  
             the Legislature on how to continue GHG emissions reductions  
             beyond 2020.

          This bill:  

          1) Requires the ARB to approve in a public hearing a statewide  
             GHG emission limit of 80% below the 1990 level of GHG  
             emissions, to be achieved by 2050 and based on the best  
             available scientific, technological, and economic  
             assessments, and requires the limit include short-lived  
             climate pollutants, as defined.

          2) Authorizes the ARB to approve 2030 and 2040 interim GHG  
             emission targets, consistent with the 2050 limit. 

          3) Specifies Legislative intent that the 2050 limit remain in  
             effect and be used to maintain and continue emissions  
             reductions beyond 2050.

          4) Requires the ARB to make recommendations to the Governor and  
             the Legislature on how to continue GHG emissions reductions  
             beyond 2050.

          5) Specifies that it is the intent of the Legislature for the  
             Legislature and appropriate agencies, in achieving the 2050  
             GHG emissions limit, to adopt policies that ensure those  


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             long-term emission reductions advance the following: 

             a)    Job growth and local economic benefits in the state.

             b)    Public health benefits for Californians, particularly  
                in disadvantaged communities.

             c)    Innovation in technology and energy and resource  
                management practices.

             d)    Regional and international collaboration to adopt  
                similar GHG emission reduction policies.

          Climate change.  The 5th assessment report from the  
          Intergovernmental Panel on Climate Change (IPCC) notes that  
          atmospheric concentrations of global warming pollutants have  
          risen to levels unseen in the past 800,000 years.  Carbon  
          dioxide concentrations have increased by 40% since  
          pre-industrial times.  There is broad scientific consensus that  
          these global GHG emission increases are leading to higher air  
          and water temperatures as well as rising sea levels.  Sea level  
          is expected to rise 17 to 66 inches by 2100, and the frequency  
          of extreme events such as heat waves, wildfires, floods, and  
          droughts is expected to increase.  

          The Global Warming Solutions Act of 2006. In 2006, the Global  
          Warming Solutions Act of 2006, AB 32 (Nez, Pavley, Chapter  
          488, Statutes of 2006), requires the ARB to determine the 1990  
          statewide GHG emissions level and approve a statewide GHG  
          emissions limit that is equivalent to that level, to be  
          achieved by 2020. 

          AB 32 requires the ARB, among other things, to:

           Inventory GHG emissions in California.

           Implement regulations that achieve the maximum  
            technologically feasible and cost-effective reduction of GHG  
            emissions and impose fees for administrative implementation  


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           Identify and adopt regulations for discrete early action  

           Prepare and approve a scoping plan to achieve the maximum  
            technologically feasible and cost-effective reduction of GHG  
            emissions by 2020, to be updated every five years.

          The statute also specifies that the ARB may include  
          market-based compliance mechanisms in the AB 32 regulations,  
          after considering the potential for direct, indirect, and  
          cumulative emission impacts from these mechanisms.
          AB 32 Scoping Plan.  Pursuant to AB 32, the ARB approved the  
          first Scoping Plan in 2008.  The Scoping Plan outlined a suite  
          of measures aimed at achieving 1990-level emissions, a reduction  
          of 80 million metric tons of CO2 (MMT CO2e).  Average emission  
          data in the Scoping Plan reveal that transportation accounts for  
          almost 40% of statewide GHG emissions, and electricity and  
          commercial and residential energy sector account for over 30% of  
          statewide GHG emissions.  The industrial sector, including  
          refineries, oil and gas production, cement plants, and food  
          processors, was shown to contribute 20% of California's total  
          GHG emissions. 

          The 2008 Scoping Plan recommended that reducing GHG emissions  
          from the wide variety of sources that make up the state's  
          emissions profile could best be accomplished through a  
          cap-and-trade program along with a mix of other strategies  
          including a low carbon fuel standard (LCFS), light-duty vehicle  
          GHG standards, expanding and strengthening existing energy  
          efficiency programs, and building and appliance standards, a 33%  
          Renewable Portfolio Standard (RPS), and regional  
          transportation-related GHG targets. Pursuant to authority under  
          AB 32, the ARB adopted a Low Carbon Fuel Standard in 2009, and a  
          cap-and-trade program, approved on December 13, 2011.

          Scoping Plan update.  ARB approved an update to the Scoping Plan  
          on May 22, 2014.  The update describes policies, actions, and  
          strategies in the energy, transportation, fuels, agriculture,  
          waste, and natural lands sectors as a means to continue  
          emissions reductions in each of these sectors. The update also  


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          asserts that California is on track to meet the near-term 2020  
          GHG limit and is well positioned to maintain and continue  
          reductions beyond 2020 as required by AB 32.

          Short-lived climate pollutants.  CO2 remains in the atmosphere  
          for centuries, which makes it the most critical GHG to reduce in  
          order to limit long-term climate change.  However, climate  
          pollutants including methane, hydrofluorocarbons (HFCs), and  
          soot (black carbon), are relatively short-lived (anywhere from a  
          few weeks to 15 years), but have much higher global warming  
          potentials than CO2.  New research suggests that aggressively  
          reducing these short-lived climate pollutants in the short-term,  
          compared to only cutting CO2 emissions, can do more to slow sea  
          level rise and other climate change impacts in the near-term. 
          SB 605 (Lara, Chapter 523, Statutes of 2014) requires the ARB to  
          complete a comprehensive strategy to reduce emissions of  
          short-lived climate pollutants by January 1, 2016.  

          Executive Orders. In 2005, Governor Schwarzenegger issued  
          Executive Order S-3-05 and called for GHG emissions reductions  
          to 1990 levels by 2020 and 80% below 1990 levels by 2050.  

          On April 29, 2015, Governor Brown issued Executive Order  
          B-30-15, which established an interim statewide GHG emission  
          reduction target to reduce GHG emissions to 40% 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."  The EO also directed all state agencies with  
          jurisdiction over sources of GHG emissions to implement  
          measures, pursuant to statutory authority, to achieve reductions  
          of GHG emissions to meet the 2030 and 2050 greenhouse gas  
          emissions reductions targets.
          Purpose of Bill.  According to the author, "Following the  
          issuance of Executive Order S-03-05, which set a long-term  
          greenhouse gas emissions reduction target for California of 80  
          percent below 1990 levels by 2050, the Legislature enacted AB 32  
          (Nez-Pavley, 2006).  The express intent of AB 32 was for the  
          California Air Resources Board (ARB) to continue reducing  
          greenhouse gas emissions beyond the 2020 limit established  


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          therein. The Legislature also directed the ARB to develop  
          regional greenhouse gas emissions reduction targets for  
          automobiles and light trucks for 2035 in SB 375 (Steinberg,  

          "In the Scoping Plan Update issued in May 2014, the ARB  
          identified a number of cost-effective, technologically feasible  
          pathways to emissions reductions required by 2030, 2040 and 2050  
          to adequately protect the health, safety and welfare of  
          Californians from the mounting costs of unabated climate change.  
           While the courts have affirmed this ongoing authority to reduce  
          greenhouse gas emissions beyond 2020 (See Cleveland National  
          Forest Foundation v. San Diego Association of Governments (4th  
          Dist., Div. 1, No. D063288, Nov. 24. 2014)), the Legislature has  
          not yet given direction to shape future reduction strategies.

          "SB 32 would provide regulatory certainty by establishing the  
          greenhouse gas reduction limit of 80 percent below 1990 levels  
          by 2050 in law. This level of climate pollution has been  
          identified by the international scientific community as  
          necessary to stave off the worst effects of climate change on  
          California's health and safety.  The target is guided by  
          science, but this bill provides the flexibility inherent in the  
          existing AB 32 framework to adjust pathways to the goal along  
          the way based on changing technological and economic conditions,  
          and ongoing evaluations of policy efficacy.  The legislation  
          also identifies goals to ensure that greenhouse gas reductions  
          advance job creation; public health improvement, especially in  
          disadvantaged communities; innovation; and policy collaboration  
          beyond our borders.

          "By simply amending the existing AB 32 framework without any  
          major mechanical changes to the regulatory implementation  
          process, SB 32 ensures that the policy tools currently being  
          utilized to achieve the existing 2020 greenhouse gas target  
          remain available for the achievement of targets beyond 2020 -  
          including, but not limited to, energy efficiency requirements  
          for buildings and appliances, tailpipe emissions standards for  
          mobile sources, power sector renewable portfolio and emissions  
          performance standards, sustainable land use policies,  
          fuel-related emissions standards, and market based mechanisms -  
          to maximize the effectiveness of our climate policies overall."


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          Related/Prior Legislation
          AB 32 (Nez, Pavley, Chapter 418, Statutes of 2006) required  
          the ARB to establish a GHG emissions limit equal to 1990 level  
          of emissions, to be achieved by 2020. 

          SB 1125 (Pavley, 2014) would have required the ARB, in  
          consultation with other entities, to develop reduction targets  
          for GHG emissions for 2030 in an open and public process by  
          January 1, 2016.  SB 1125 was held on the Senate Appropriations  
          Committee suspense file. 

          FISCAL EFFECT:   Appropriation:    No          Fiscal  
          Com.:YesLocal:   No

          According to the Senate Appropriations Committee:

           Minor and absorbable costs to the Cost of Implementation  
            Account (special) to the Air Resources Board to set the 2050  

           Unknown annual costs, at least in the hundreds of millions of  
            dollars, from various special funds for additional programs to  
            achieve the required emission reductions. 

          SUPPORT:   (Verified 5/28/15)

          Barbara Boxer, US Senator, California

          350 Bay Area


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          350 Sacramento

          Access to Independence

          Adam Schiff, US Representative, 28th District

          American Academy of Pediatrics, California

          American Cancer Society Cancer Action Network, California

          American College of Physicians, California Service Chapter

          American Farmland Trust

          American Heart Association, California

          American Lung Association, California 


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          Annie's Inc.

          Asthma Coalition of Los Angeles County





          Bay Area Air Quality Management District

          Baz Allergy, Asthma and Sinus Center


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          Big Sur Land Trust 

          Bioenergy Association of California

          Biosynthetic Technologies

          Bonnie J. Adario Lung Cancer Foundation

          Breathe CA            

          Building Doctors

          Business for Innovative Climate and Energy Policy 

          C&C Development Company

          California Bicycle Coalition


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          California Biodiesel Alliance

          California Black Health Network

          California Climate & Agriculture Network

          California Conference of Directors of Environmental Health

          California Energy Efficiency Industry Council 

          California Energy Storage Association 

          California Green Business Network

          California Interfaith Power & Light 


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          California League of Conservation Voters 

          California Nurses Association 

          California Pan Ethnic Health Network

          California Public Health Association, North California Service  

          California Ski Industry Association 

          California Solar Energy Industry Association 

          California Thoracic Society 

          California Transit Association


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          California Wind Energy Association 

          Californians Against Waste



          Carbon Cycle Institute

          Catholic Charities, Diocese of Stockton

          Center for Biological Diversity

          Center for Climate Change and Health

          Center for Food Safety 


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          Central California Asthma Collaborative


          Circulate San Diego

          City and County of San Francisco

          City Heights Community Development Corporation

          City of Berkeley

          City of Oxnard

          City of Santa Monica


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          City of Thousand Oaks

          City of West Hollywood

          Clean Power Finance

          Clean Water Action

          Cleveland National Forest Foundation

          Climate Parents 

          Climate Ready Solutions LLC

          Climate Resolve


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          Coalition for Renewable Natural Gas

          Coastal Environmental Rights Foundation

          Communications Workers of America - District 9 

          Communitas Financial Planning

          County of Ventura

          Department of Public Health, Los Angeles County

          Dignity Health

          Distance Learning Consulting

          Doctors for Climate Health


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          Eagle Creek

          eBay, Inc

          Ecogate, Inc

          Endangered Habitats League 

          Environment California

          Environmental Action Committee of West Marin

          Environmental Action Defense Fund 

          Environmental Entrepreneurs 


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          Friends Committee on Legislation of California 

          Friends of the River

          Gap, Inc.

          Global Green USA

          Greenbelt Alliance

          Health Care Without Harm

          Health Officers Association of California 

          House Kombucha


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          Housing California

          Humane Society 

          Klean Kanteen

          Land Trust of Santa Cruz County

          Large Scale Solar

          League of Women Voters of California

          League of Women Voters of Orange Coast

          Levi Strauss & Co


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          Los Angeles Business Council 


          Medical Advocates for Healthy Air

          Mercury Press International

          Moms Clean Air Force

          Mountains Recreation and Conservation Authority 

          National Parks Conservation Association

          Natural Resources Defense Council 


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          NextGen Climate

          Patagonia Works

          Peninsula Open Space Trust 

          Physicians for Social Responsibility, Los Angeles 

          Physicians for Social Responsibility, San Francisco Bay Area  


          Progressive Asset Management, Inc.

          Public Health Institute

          Puma Springs Vineyards


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          Purple Wine & Spirits


          RC Cubed, Inc

          Redland's Area Democratic Club

          Regional Asthma Management and Prevention 


          San Diego Housing Federation

          San Diego-Imperial Counties Labor Council 


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          San Francisco Asthma Task Force

          Santa Clara County Medical Society

          Santa Clara Valley Open Space Authority

          Santa Clarita Organization for Planning and the Environment 

          Sequioa Riverlands Trust

          Sidel Systems USA

          Sierra Business Council 

          Sierra Club


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          Silicon Valley Leadership Group 


          Solar Energy Industry Association 

          Sonoma Agricultural Preservation and Open Space District

          Sonoma County Asthma Coalition

          South Coast Air Quality Management District

          Southwest Wetlands Interpretive Association

          Sustainable North Bay

          Symantec Corporation


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          Tamalpais NatureWorks

          The Hampstead Companies

          The Nature Conservancy

          The North Face


          Trust for Public Lands

          Union of Concerned Scientists 

          US Green Buildings Council 


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          Ventura Climate Care Options Organized Locally 

          Wakeland Housing and Development Corporation

          Waterplanet Alliance

          Wholly Hemp

          47 Individuals

          OPPOSITION: (Verified 5/28/15)

          African American Farmers of California
          Agricultural Council of California
          American Forest and Paper Association
          American Wood Council
          Brea Chamber of Commerce
          Building Owners and Managers Association
          California Agricultural Aircraft Association
          California Association of Nurseries and Garden Centers
          California Business Properties Association
          California Cattlemen's Association
          California Chamber of Commerce
          California Construction Trucking Association
          California Cotton Ginners Association


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          California Cotton Growers Association
          California Dairies, Inc.
          California Farm Bureau Federation
          California Fresh Fruit Association
          California Independent Oil Marketers Association
          California Independent Petroleum Association
             California League of Food Processors
          California Manufacturers and Technology Association
          California Taxpayers Association
          California Trucking Association
          Camarillo Chamber of Commerce
          Chamber of Commerce Alliance of Ventura and Santa Barbara
          Fresno Chamber of Commerce
          Fullerton Chamber of Commerce
          Greater Bakersfield Chamber of Commerce
          International Council of Shopping Centers
          Irvine Chamber of Commerce
          Los Angeles County Solid Waste Management Committee/Integrated  
            Waste Management Task Force
          NAIOP-Commercial Real Estate Development Association
          National Federation of Independent Business
          National Hmong American Farmers
          Nisei Farmers League
          Oxnard Chamber of Commerce
          Rancho Cordova Chamber of Commerce
          Redondo Beach Chamber of Commerce and Visitor Bureau
          San Jose Silicon Valley Chamber of Commerce
          Santa Maria Valley Chamber of Commerce and Visitor Bureau
          Simi Valley Chamber of Commerce
          South Bay Association of Chambers of Commerce
          Southwest California Legislative Council
          Torrance Chamber of Commerce
          Western Agricultural Processors Association
          Western Growers Association
          Western Plant Health Association
          Western States Petroleum Association


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          ARGUMENTS IN SUPPORT:     Supporters state that SB 32 provides  
          the regulatory certainty that investors and the business  
          community need in order to make long-term climate goals  
          attainable.  They also note that SB 32 would help protect public  
          health of Californians, affirms the state's commitment to  
          provide resources and solutions to communities that will be most  
          impacted by climate change, and advances California's climate  
          leadership on the world stage.  Supporters further state that SB  
          32 is critical to continue the progress that California has made  
          in reducing GHG emissions, attracting investments in clean  
          energy and energy efficiency, and diversifying California's  

          ARGUMENTS IN OPPOSITION:Opponents state that SB 32 will increase  
          the cost to California's businesses, make them less competitive,  
          and discourage economic growth by mandating a reduction in the  
          GHG emissions to 80% below 1990 levels by 2050 with no  
          consideration of the economic side effects.  Opponents note that  
          before any additional GHG emission reduction targets are set,  
          there must be a credible and independent marginal cost analysis  
          on the strategies adopted thus far in order to educate and guide  
          GHG reductions post 2020, and understand what has and what has  
          not worked.

          Prepared by:Rebecca Newhouse / E.Q. / (916) 651-4108
          5/31/15 11:27:50

                                   ****  END  ****



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