BILL ANALYSIS Ó
SB 32
Page 1
SENATE THIRD READING
SB
32 (Pavley)
As Amended August 31, 2015
Majority vote
SENATE VOTE: 24-15
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|Committee |Votes|Ayes |Noes |
| | | | |
| | | | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Natural |6-3 |Williams, Cristina |Dahle, Hadley, |
|Resources | |Garcia, McCarty, |Harper |
| | |Rendon, Mark Stone, | |
| | |Wood | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Appropriations |12-5 |Gomez, Bloom, Bonta, |Bigelow, Chang, |
| | |Calderon, Nazarian, |Gallagher, Jones, |
| | |Eggman, Eduardo |Wagner |
| | |Garcia, Holden, | |
| | |Quirk, Rendon, Weber, | |
| | |Wood | |
| | | | |
| | | | |
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SB 32
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SUMMARY: Requires the Air Resources Board (ARB) to approve
statewide greenhouse gas (GHG) emissions limits equivalent to
40% below the 1990 level by 2030 and 80% below the 1990 level by
2050. Prohibits ARB from implementing the next update of the
California Global Warming Solutions Act of 2006 (AB 32 (Núñez),
Chapter 488, Statutes of 2006) Scoping Plan until ARB has taken
specified actions, including submitting the draft Scoping Plan
to the Legislature and waiting at least one year before adopting
the Scoping Plan. Specifically, this bill:
1)Requires ARB to approve, based on the best available
scientific, technological, and economic assessments, the
following statewide limits on GHG emissions, including
short-lived climate pollutants:
a) 40% below the 1990 level by 2030.
b) 80% below the 1990 level by 2050.
2)Authorizes ARB to approve an interim GHG emissions target to
be achieved by 2040.
3)States the intent of the Legislature for the Legislature and
appropriate agencies to adopt complementary policies that
ensure the long-term emissions reductions adopted pursuant to
the 2030 and 2050 limits advance all of the following:
a) Job growth and local economic benefits in California.
b) Public health benefits for California residents,
particularly in disadvantaged communities.
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c) Innovation in technology and energy, water, and resource
management practices.
d) Regional and international collaboration to adopt
similar GHG emissions reduction policies.
4)Prohibits ARB from taking any action to implement the "next
update" of the AB 32 Scoping Plan unless ARB has:
a) Conducted an evaluation, with input from an independent
advisory committee, of the current and projected GHG
reduction actions other jurisdictions are taking, as well
as the cost-effectiveness of the various GHG reduction
strategies ARB has undertaken.
b) Submitted the draft Scoping Plan to the Joint
Legislative Budget Committee and appropriate policy
committees at least one year before adoption, and submitted
the final version at least 60 days before adoption.
5)Requires the Legislature to hold at least one oversight
hearing on the draft and final Scoping Plans before adoption
by ARB.
6)Authorizes the Legislature to act to modify, reject or delay
some or all of the Scoping Plan before its adoption.
7)Requires ARB to submit an annual report including:
a) A list of regulatory policies that have been adopted and
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implemented by a state agency in furtherance of achieving
the GHG emissions limits adopted by ARB pursuant to AB 32.
b) The amounts, sources, and locations of GHG emissions
reductions achieved toward the statewide emissions limit.
8)Requires ARB, in furtherance of approving statewide GHG
emissions limits, to consider historic efforts to reduce GHG
emissions and objectively seek, and account for,
cost-effective actions to reduce GHG emission across all
sectors.
EXISTING LAW:
1)Requires ARB, pursuant to AB 32, to adopt a statewide GHG
emissions limit equivalent to the 1990 level by 2020 and adopt
regulations to achieve maximum technologically feasible and
cost-effective GHG emission reductions.
2)Authorizes ARB to permit the use of market-based compliance
mechanisms, applicable from January 1, 2012 to December 31,
2020, to comply with GHG reduction regulations, once specified
conditions are met. Pursuant to this authority, ARB has
adopted a cap-and-trade regulation which applies to large
industrial facilities and electricity generators emitting more
than 25,000 metric tons of carbon dioxide (CO2) equivalent per
year, as well as distributors of fuels, including gasoline,
diesel and natural gas.
FISCAL EFFECT: According to the Assembly Appropriations
Committee:
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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.
2)Minor, absorbable costs for the ARB to set the 2030, 2040 and
2050 GHG targets (Cost of Implementation Account).
COMMENTS:
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.
Pursuant to AB 32, 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
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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%
Renewables 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.
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 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.
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.
In 2005, Governor Schwarzenegger issued Executive Order (EO)
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
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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 GHG emissions reductions targets.
According to the author:
SB 32 sets an enforceable greenhouse gas reduction
target of 80% below 1990 levels by 2050, 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. 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.
To ensure that the state accomplishes our 2050 target
through the most cost-effective pathway, SB 32
incorporates the Governor's midterm target of reducing
climate pollution to 40% below 1990 levels by 2030.
By simply amending the existing AB 32 framework
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without any major mechanical changes to the regulatory
implementation process, SB32 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.
In addition to requiring ARB to approve 2030 and 2050 statewide
GHG emissions limits, this bill makes conforming changes to
other sections of AB 32 that refer to the 2020 limit to reflect
the commitment to continue the AB 32 program beyond 2020.
However, the bill does not extend the "market-based compliance
mechanism" provision, under which ARB has adopted a
cap-and-trade regulation applicable through 2020. The
cap-and-trade regulation is a key element in the regulatory
program to achieve the 2020 limit and, through the auction of
emissions allowances, produces revenues that are invested in
programs to produce additional GHG emission reductions.
Unlike AB 32, which required ARB to approve the 2020 limit one
year after the bill was enacted, this bill provides no deadline
for ARB to approve the 2030 and 2050 limits. Because the 1990
level has already been determined by ARB and this bill
prescribes the reduction percentages, there is little question
about what the limits will be, but it's unclear when ARB will
approve them.
Analysis Prepared by:
SB 32
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Lawrence Lingbloom / NAT. RES. / (916) 319-2092
FN:
0001977