BILL ANALYSIS Ó
SB 189
Page 1
Date of Hearing: June 23, 2015
ASSEMBLY COMMITTEE ON JOBS, ECONOMIC DEVELOPMENT, AND THE ECONOMY
Eduardo Garcia, Chair
SB
189 (Hueso) - As Amended June 1, 2015
SENATE VOTE: 26-14
SUBJECT: Clean Energy and Low-Carbon Economic and Jobs Growth Blue
Ribbon Committee.
SUMMARY: Establishes the Clean Energy and Low-Carbon Economic and
Jobs Growth Blue Ribbon Committee (Clean Energy Committee) for the
purpose of advising state agencies on the most effective ways to
maximize California's economic benefits and jobs growth via actions
and investments in a cleaner, low-carbon economy. Specifically, this
bill:
1)Finds and declares that:
a) Numerous analyses have shown that California is a world leader
in clean energy and greenhouse gas emission (GHG) reduction law
and policy which has led to major employment and economic benefit
to the state, as well as providing significant environmental and
public health benefits. One report is cited as stating 430,000
jobs have been created as a result of California's advanced
energy policies and that California ranks first in the nation for
installed solar capacity, the number of solar jobs, the total
amount of advanced energy investments, and electric car sales.
SB 189
Page 2
b) The State Air Resources Board, the State Energy Resources
Conservation and Development Commission, and the Public Utilities
Commission have all created advisory committees to help them
better understand the implications of their clean energy and
climate policies and to ensure that the state's clean energy and
climate programs are optimized for maximum economic benefit and
job creation.
c) The purpose of this legislation is to create a single
independent blue ribbon committee to provide advice to these and
other agencies on the most effective ways to maximize
California's economic benefits and jobs growth via actions and
investments in a cleaner, low-carbon economy.
1)Establishes the seven-member Clean Energy Committee under the
auspicious of California Environmental Protection Agency (CalEPA).
Five of the members are to be appointed by the Governor (subject to
confirmation by the Senate) and the Speaker of the Assembly and the
Senate Committee on Rules each appoint one member.
2)Specifies that each Clean Energy Committee member serves a term of
four years.
3)Prohibits committee members from receiving per diem or other
compensation for their service. Members are, however, authorized to
receive reimbursement for actual expenses incurred in connection
with the performance of their duties.
4)Requires that the Clean Energy Committee members have expertise in
economic, financial, and policy aspects of clean energy economic
growth, job creation, workforce standards, and employment
opportunities for disadvantaged workers. At least two members of
SB 189
Page 3
the committee are required to have experience working on economic
projects in disadvantaged communities.
5)Requires the Clean Energy Committee to advise state agencies on the
most effective ways to expend clean energy and GHG-related funds and
to implement policies that maximize California's economic and
employment benefits. In undertaking its duties, the bill requires
the Clean Energy Committee to do all the following:
a) Develop guidance for tracking and reporting jobs outcomes for
state clean energy and low-carbon investments and use this
information to evaluate jobs outcomes.
b) Develop guidance, in consultation with the Labor and Workforce
Development Agency, to measure the quantity and quality of jobs
created by state investments in clean energy and low-carbon
investments, as well as guidance to measure the geographic and
demographic distribution of jobs.
c) Advise state agencies on the most effective ways to require
responsible contractor standards, as applicable, and minimum
training and skill certifications for workers to ensure
high-quality work for state clean energy and low-carbon
investments, and the most effective ways to connect disadvantaged
communities and other target populations to good quality jobs and
career pathways created by those investments.
d) Advise state agencies, in consultation with the California
Workforce Investment Board (CWIB), on the most effective ways to
align state clean energy and low-carbon training funds with
existing state workforce development investments and strategies.
SB 189
Page 4
1)Requires the Clean Energy Committee to provide an annual update to
the Governor and the appropriate policy and fiscal committees of the
Legislature on its activities.
2)Requires the State Energy Resources Conservation and Development
Commission, the Public Utilities Commission, the State Air Resources
Board, and any other state agency responsible for implementing clean
energy and low-carbon policies and programs to submit an annual
progress report to the Governor and the appropriate policy and
fiscal committees of the Legislature describing how it implemented
or responded to the advice, guidance, and any recommendations
provided by the Clean Energy Committee.
3)Authorizes a state agency to include the reporting requirements of
this bill within any other annual report the state agency, as
specified.
4)Sunsets the provision of this bill on January 1, 2021.
EXISTING LAW:
1)Enacts the California Global Warming Solutions Act, which requires
the California Air Resources Board (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
to adopt GHG emission reduction measures by regulation, and sets
certain requirements in adopting the regulations.
2)Establishes the Green Collar Jobs Council (GCJC) within the CWIB,
for the purpose of consulting with other state agencies, among
others, on developing the funding, strategies, programs, policies,
partnerships, and opportunities necessary to address the growing
need for a highly skilled and well-trained workforce to meet the
SB 189
Page 5
needs of California's emerging green economy. To the extent private
funds are available, it is the intent of the Legislature that the
GCJC develop an annual award for outstanding achievement for
workforce training programs. The GCJC is comprised of the
appropriate representatives from the CWIB existing membership.
3)Requires the ARB to convene an Environmental Justice Advisory
Committee (EJAC), to advise the ARB in developing the Scoping Plan,
and any other pertinent matter in implementing the Act. Requires
that the EJAC be comprised of representatives from communities in
the State with the most significant exposure to air pollution,
including, but not limited to, communities with minority populations
or low-income populations.
4)Requires the ARB to appoint an Economic and Technology Advancement
Advisory Committee (ETAAC) to advise the ARB on activities that will
facilitate investment in and implementation of technological
research and development opportunities, including, but not limited
to, identifying new technologies, research, demonstration projects,
funding opportunities, developing state, national, and international
partnerships and technology transfer opportunities, and identifying
and assessing research and advanced technology investment and
incentive opportunities that will assist in the reduction of
greenhouse gas emissions. Provides that the ETAAC may also advise
the ARB on state, regional, national, and international economic and
technological developments related to greenhouse gas emission
reductions.
5)Eastablishes the State Agency GHG Reduction Report Card (Report
Card), which requires among other things, that on or before October
1 of each year, each state agency prepare and submit to the CalEPA
Secretary:
SB 189
Page 6
a) A list of measures that have been adopted and implemented to
meet GHG emission reduction targets and a status report on actual
GHG emissions reduced as a result of these measures.
b) A list and timetable for adoption of any additional measures
needed to meet GHG emission reduction targets.
c) An estimate of the department's own greenhouse gas emissions,
as well as an explanation of any increase or decrease compared to
the previous year's emissions.
6)Requires CalEPA to compile and organize the information submitted by
the state agencies into a format representative of a Report Card.
In addition, the Report Card is required to include a comparison of
the actions taken/proposed to be taken by individual state agencies
and their projected annual GHG emission reductions against the state
agency GHG emission reduction targets and statewide GHG emission
reduction limits.
7)Requires CalEPA to summit to the Legislature a comprehensive budget
display on or before January 10 of each year, that identifies
funding proposals and base funding in the proposed Governor's Budget
that are inteneded to help the state reach its greenhouse gas
emissions reduction targets as specified in the California Global
Warming Solutions Act of 2006, and a five-year work plan summary
that shows how staff and contracting resources will be allocated to
achieve specified climate solution deliverables.
FISCAL EFFECT: Unknown
SB 189
Page 7
POLICY ISSUE FRAME:
In 2008, the GCJC was established under the auspiciousness of the CWIB
for the purposes of responding to the workforce and economic
development needs of California's transition to a lower carbon
economy. The Legislature and Governor understood that addressing
rising GHG emissions would require the development of new and adaption
of existing technologies and processes, as well as the termination, or
at least the reduction, of some business activities within the state.
This, in turn, would require a differently skilled workforce and
potentially spur new business opportunities and job creation.
Most recently, the GCJC has engaged on the deployment of Proposition
39 funds, supported a workforce plan for investor-owned utilities and
energy efficiency, and discussed workforce and credentialing standards
with the U.S. Department of Energy. In the past, the GCJC adopted a
Green Workforce Master Plan and proposed job and workforce development
program elements for the state's carbon reduction investments.
AB 189 proposes a more narrowly focused stakeholder advisory
committee, which would be tasked with specifically looking at
potential state expenditures and state policies that support economic
growth and job creation in the clean energy field. The SB 189
stakeholder advisory committee will also have a unique set of
expertise from the GCJC, which should assist the committee in
developing recommendations that provide for a more inclusive workforce
development system, especially for historically underserved groups of
individuals and economic development efforts in disadvantaged
communities.
In the comment section of the analysis is additional information on
the California economy, unemployment, and economic opportunities
within cleantech and energy-related industries. Suggestions for
technical amendments are provided under Comment 4.
COMMENTS:
SB 189
Page 8
1)Author's Purpose: According to the author's statement, " As the
Legislature and the Governor articulate next steps for our clean
energy and climate policies, it is important to have a permanent and
formal committee that can advise agencies implementing such policies
on the best ways to maximize expenditure of public funds to ensure
the state achieves the greatest economic growth and job creation. SB
189 would establish a high-level expert Blue Ribbon Committee to
serve that role of advising state clean energy and climate actions
to ensure maximum job creation and economic benefits to California."
2)The California Workforce: California is home to over 38 million
people, providing the state with one of the most diverse populations
in the world, often comprising the single largest concentration of
nationals outside their native country. In 2014, this diverse group
of business owners and workers produced $2.3 trillion in goods and
services; $174.1 billion of which were exported to over 220
countries around the world. California's 2014 GDP ranks the state
economy as the eighth largest in the world.
Many policy makers and economists describe California as having not a
single economy, but having a highly integrated network of a dozen or
so regional economies. While biotech has a comparative advantage in
some regions, information technology drives growth in others. This
econmic diversity is one of the reasons California was able to so
aggressively move out of the recession, ranking number two in the
nation by Business Insider for fastest growing economy in the nation
in August 2014 and as having the fourth best overall economy in
March 2015. There are approximately 19 million people within the
California workforce. Below is a chart of California employment by
industry sector.
Another key economic driver in California is the agriculture sector,
which is includes a number of the industry sectors displayed above.
One estimate, by researchers at Butte Community College, is that
SB 189
Page 9
California's agriculture value chain contributes nearly $300 billion
annually to the economy and accounts for nearly 2.5 million jobs
across 800 different job titles.
While many areas of the state have continued to experience economic
growth, other regions continue to lag in terms of jobs and business
activity. Increasingly, the state is becoming economically divided.
As an example, in May 2015, the overall state unemployment rate was
6.2%. The lowest unemployment rate was reported for San Mateo
(3.2%), followed by Marin (3.3%) and San Francisco (3.5%). In stark
contrast to the Bay Area's economic vitality is Imperial County,
which registered a 21.1% unemployment rate. In fact, 21 of
California's 58 counties had rates below 6.0% and 34 counties had
unemployment rates above the 6.2% state rate. A majority of the
counties experiencing the higher unemployment rates were in the
state's inland regions. In addition to regional differences,
unemployment rates also differ by age, race, and ethnicity. For May
2015 the highest unemployment was reported to be among 16 to 19 year
olds (22.3%), blacks (13.4%), and Hispanics (8%).
Given the significant financial and policy priority the state has
placed on GHG emission reductions, it is important that related
activities reflect the specific conditions and circumstances of all
regions and populations. Transitioning to a lower carbon economy
has economic costs, as well as opportunities, which the state has
been slow to address. Part of the ultimate goal for California's
less carbon intensive economy should be a more inclusive workforce
and business development platform.
AB 189 addresses the need for greater economic justice in policy
making by requiring at least two of the seven members of the Clean
Energy Committee have expertise in working on economic projects in
disadvantaged communities. Further, the overall membership is
required to have experience in not just clean energy, but also job
creation, workforce standards, and employment opportunities for
disadvantaged workers.
SB 189
Page 10
3)The Clean Energy Job Market: California's clean energy and
technology economy encompasses a broad range of products and
services, touching upon multiple industry sectors. This includes
clean technology such as alternative energy generation, wastewater
treatment, and the production of environmentally-friendly consumer
products. Although some of these industries are very different,
they all use innovative technologies, products, and services that
have environmental benefits.
Growth in the cleantech industry largely comes from the convergence of
two disparate factors. One, recent advances in new technologies,
research methods, manufacturing, and communications that lower the
cost of environmentally sensitive technologies; and two, an
increasing number of consumers and businesses that are looking for
ways to reduce energy costs, increase clean water supply, and meet
new environmental regulatory requirements at the local, state, and
global levels. Governments, in turn, have adopted new regulatory
frameworks that require greater use of recyclable materials,
increased the use of renewable energy, and lowered air pollution and
GHG emissions.
Legislative findings in SB 189 state that numerous analyses have shown
that California is a world leader in clean energy and GHG reduction
law and policy, which has been a significant contributor to the
California job market, providing economic, as well as environmental
and public health benefits.
The chart below, developed by Cleantech San Diego, illustrates the
wide range of industries engaged in the cleantech industry cluster.
SB 189
Page 11
-------------------------------------------------------------------
| Chart 4: Examples of Cleantech Industries |
-------------------------------------------------------------------
|----------+--------------------------------------------------------|
|Agricultur|Bio-based materials; farm efficiency technologies; |
|e |micro-irrigation systems; bio-remediation; and |
| |non-toxic cleaners and natural pesticides. |
|----------+--------------------------------------------------------|
|Air & |Air purification products and air filtration systems; |
|Environmen|energy efficient HVAC; universal gas detectors; |
|t |multi-pollutant controls; and fuel additives to |
| |increase efficiency and reduce toxic emissions. |
|----------+--------------------------------------------------------|
|Materials |Biodegradable materials derived from seed proteins; |
| |micro-fluidics technology for conducting biochemical |
| |reactions; nano-materials; composite materials; thermal |
| |regulating fibers and fabrics; environmentally-friendly |
| |solvents; nano-technology components for electronics, |
| |sensor applications and energy storage; electro-chromic |
| |glass; and thermoelectric materials. |
|----------+--------------------------------------------------------|
|Energy |Energy Efficiency: Energy management systems; systems |
| |that improve output of power generating plants; |
| |intelligent metering; solid state micro refrigeration; |
| |control technology for HVAC systems; and automated |
| |energy conservation networks. |
| |Energy Generation: Distributed and renewable energy |
| |and conversion, including wind, solar/photovoltaic |
| |(PV), hydro/marine, biofuels, fuel cells, gasification |
| |technologies for biomass, and flywheel power systems. |
| |Energy Infrastructure: Wireless networks to utilities |
| |for advanced metering; power quality monitoring and |
| |outage management; integrated electronic systems for |
| |the management of distributed power; and demand |
| |response and energy management software. |
| |Energy Storage: Batteries, e.g. thin film and |
| |rechargeable; power quality regulation; flywheels; and |
| |electro-textiles. |
|----------+--------------------------------------------------------|
|Manufactur|Advanced packaging; natural chemistry; sensors; smart |
SB 189
Page 12
|ing and |construction materials; business process and data flow |
|Industrial|mapping tools; precision manufacturing instruments & |
| |fault detectors; and chemical management services. |
|----------+--------------------------------------------------------|
|Recycling |Recycling technologies; waste treatment; internet |
|& Waste |marketplace for materials; hazardous waste remediation; |
| |and bio-mimetic technology for advance metals |
| |separation and extraction. |
|----------+--------------------------------------------------------|
|Transporta|Hybrid vehicle technology; lighter materials for cars; |
|tion |smart logistics software; car-sharing; and temperature |
| |pressure sensors to improve transportation fuel |
| |efficiency; telecommuting. |
|----------+--------------------------------------------------------|
|Water & |Water recycling and ultra-filtration systems (e.g. UV |
|Wastewater|membrane & ion exchange systems); sensors and |
| |automation systems; and water utility sub-metering |
| |technology; desalination equipment. |
-------------------------------------------------------------------
-------------------------------------------------------------------
|Source: Cleantech San |
|Diego |
-------------------------------------------------------------------
A December 2014 survey of 2,000 companies by the Advanced Energy
Economy Institute found that state advanced energy policies have
created over 430,000 jobs in 2014, which was an increase of 5% over
the prior year. The survey also noted that significant comparative
advantage California has over other areas, as demonstrated by the
state having the most domestic installed solar capacity, solar jobs,
total advanced energy investment, and electric vehicle sales.
Another important finding was that 77% of the responding firms only
had customers in California and only 3% had customers outside the
U.S. Given California's geographic location and already
demonstrated capability to successfully engage within global supply
chains, export opportunities could be substantial for California's
advanced energy industries.
SB 189
Page 13
4)Proposed Amendments: Below is a list of technical amendments that
will assist in the implementation of the bill.
a) Clarify that an individual committee member is required to
have expertise in at least one of the specified areas, not all of
the specified areas.
b) Set a date for the first meeting in order to establish a clear
timeline for appointments.
c) Clarify that vacancies will be filled in the same manner as
the initial appointments.
d) Clarify which of the three appointing authorities has the
responsibility for appointing the individuals with experience in
working with disadvantaged communities.
e) Add a definition of agency.
f) Clarify that only those agencies that received advice from the
Clean Energy Committee are required to provide a progress report
to the Governor and Legislature.
As the measure moves forward, the author may also want to consider
ways to more concretely differentiate the SB 189 advisory committee
from the work already being performed by the GCJC.
5)Related Legislation: This bill is part of the California State
Senate's Climate Bill Package. Madame Speaker has also introduced a
major GHG reduction bill. A selection of these bills are described
SB 189
Page 14
below.
a) AB 1288 (Atkins) ARB Regulation Sunset: This bill eliminates
the December 31, 2020, limit on applicability of a market-based
mechanism to reduce greenhouse gas (GHG) emissions that may be
adopted by the Air Resources Board. Status: Pending in the
Senate Committee on Environmental Quality.
b) AB 1030 (Ridley-Thomas) would requires a state agency that
allocates moneys from the Greenhouse Gas Reduction Fund to
prioritize projects that include project labor agreements with
targeted hire goals, community workforce agreements that connect
local residents to jobs or training opportunities, or
partnerships with training entities that have a proven track
record of placing disadvantaged workers in career-track jobs.
Status: Pending in the Assembly Natural Resources Committee.
c) SB 32 (Pavley) California Global Warming Solution Act of 2006:
Emission Limit: This bill sets the overarching climate
pollution reduction target for 2050 that will provide California
businesses with regulatory certainty, improve public health, and
strengthen the economy. Status: Pending in Senate Natural
Resources.
d) SB 185 (De Léon) Divestment from Coal: This bill prohibits
the California Public Employees' Retirement System (CalPERS) and
the California State Teachers' Retirement System (CalSTRS) boards
from making new or additional investments of public employee
retirement funds in thermal coal companies, as defined, and
requires each board to liquidate its existing investments in
thermal coal companies on or before July 1, 2017, provided that
the boards make a good faith determination that thermal coal
divestment is consistent with their fiduciary responsibility.
The boards must first constructively engage with the affected
companies to determine whether they are transitioning to clean
energy generation and must report to the Legislature and Governor
by January 1, 2018, on the boards' engagement and divestment
activities. Status: Set to be heard on June 23 in the Assembly
SB 189
Page 15
Committee on Public Employees, Retirement and Social Security.
e) SB 350 (De Léon and Leno) Clean Energy and Pollution Reduction
Act of 2015: This bill enacts the Clean Energy and Pollution
Reduction Act of 2015, which creates or expands three related
clean-energy goals to be achieved by 2030: (1) a 50 percent
reduction in petroleum used in motor vehicles; (2) a doubling of
the energy efficiency of existing buildings; and (3) generating
50 percent of total retail sales of electricity from renewable
resources. Status: Pending in the Assembly Utilities and
Commerce Committee.
6)Double Referral: The Assembly Rules Committee has referred this
measure the Assembly Committee on Jobs, Economic Development and the
Economy and to the Assembly Committee on Natural Resources (NR).
Should this measure pass the committee, it will be referred to NR
for further policy consideration.
REGISTERED SUPPORT / OPPOSITION:
Support
Alliance for Solar Choice
American Lung Association
Audubon Society
Azul
Bloom Energy
SB 189
Page 16
California League of Conservation Voters
California State Association of Electrical Workers
Clean Transportation Technologies and Solutions
Environment California
Environmental Defense Fund
Natural Resources Defense Council
Sierra Club
Solar City
Solar Energy Industries Association
Sun-Run
Union of Concerned Scientists
Opposition
SB 189
Page 17
None received
Analysis Prepared by:Toni Symonds / J., E.D., & E. / (916)
319-2090