BILL ANALYSIS Ó SB 32 Page 1 Date of Hearing: August 19, 2015 ASSEMBLY COMMITTEE ON APPROPRIATIONS Jimmy Gomez, Chair SB 32 (Pavley) - As Amended June 1, 2015 ----------------------------------------------------------------- |Policy |Natural Resources |Vote:|6 - 3 | |Committee: | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | ----------------------------------------------------------------- Urgency: No State Mandated Local Program: NoReimbursable: No SUMMARY: This bill requires the Air Resources Board (ARB) to approve statewide greenhouse gas (GHG) emissions limits equivalent to 40% below 1990 levels by 2030 and 80% below 1990 levels by 2050. Specifically, this bill: SB 32 Page 2 1)Requires ARB to approve the statewide GHG emissions limits, including short-lived climate pollutants, based on the best available scientific, technological, and economic assessments. 2)Authorizes ARB to approve an interim GHG emissions target to be achieved by 2040. 3)States the intent of the Legislature that policies adopted to achieve the 2030 and 2050 limits advance the following: a) Job growth and local economic benefits in California. b) Public health benefits for California residents, particularly in disadvantaged communities. c) Innovation in technology and energy, water, and resource management practices. d) Regional and international collaboration to adopt similar GHG emissions reduction policies. FISCAL EFFECT: 1)Unknown annual costs, at least in the hundreds of millions of dollars, from various special funds for additional programs to achieve the new required emissions reductions. SB 32 Page 3 2)Minor, absorbable costs for the ARB to set the 2030, 2040 and 2050 GHG targets (Cost of Implementation Account). COMMENTS: 1)Purpose. According to the author, an enforceable GHG target of 80 percent below 1990 levels by 2050 is the level identified by the international scientific community as necessary to stave off the worst effects of climate change on California's health and safety. This bill adopts that target, but provides the same flexibility in the existing AB 32 framework to make adjustments based on changing technological and economic conditions, and ongoing evaluations of policy efficacy. 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 adopt regulations, including market-based compliance mechanisms, to achieve maximum technologically feasible and cost-effective GHG emission reductions. As part of the implementation of AB 32 market-based compliance measures, ARB adopted a cap-and-trade program that caps the allowable statewide emissions and provides for the auctioning of emission credits, the proceeds of which are quarterly deposited into the GGRF available for appropriation by the Legislature. SB 32 Page 4 3)AB 32 Scoping Plan Update. ARB approved an update to the AB 32 Scoping Plan on May 22, 2014. The update asserts that California is on track to meet the near-term 2020 greenhouse gas limit and is well positioned to maintain and continue reductions beyond 2020 as required by AB 32. The update emphasizes the need for California to establish a mid-term statewide emission reduction target informed by climate science, to frame the additional suite of policy measures, regulations, planning efforts, and investments in clean technologies that are needed to continue driving down emissions. Consistent with this recommendation , this bill provides a mid-term statewide emission reduction target of 45% below 1990 levels by 2030. 4)Related legislation. AB 1288 (Atkins), which is pending in the Senate Appropriations Committee, eliminates the December 31, 2020 limit on applicability of a market-based compliance mechanism under AB 32. Analysis Prepared by:Jennifer Galehouse / APPR. / (916) 319-2081 SB 32 Page 5