BILL ANALYSIS Ó ----------------------------------------------------------------- |SENATE RULES COMMITTEE | SB 1383| |Office of Senate Floor Analyses | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ----------------------------------------------------------------- UNFINISHED BUSINESS Bill No: SB 1383 Author: Lara (D), et al. Amended: 8/31/16 Vote: 21 SENATE ENVIRONMENTAL QUALITY COMMITTEE: 4-2, 4/6/16 AYES: Wieckowski, Hill, Leno, Pavley NOES: Gaines, Bates NO VOTE RECORDED: Jackson SENATE APPROPRIATIONS COMMITTEE: 5-2, 5/27/16 AYES: Lara, Beall, Hill, McGuire, Mendoza NOES: Bates, Nielsen SENATE FLOOR: 21-13, 6/1/16 AYES: Allen, Beall, Block, De León, Glazer, Hall, Hancock, Hernandez, Hertzberg, Hill, Jackson, Lara, Leno, Leyva, Liu, Mendoza, Mitchell, Monning, Pavley, Wieckowski, Wolk NOES: Anderson, Bates, Berryhill, Cannella, Fuller, Gaines, Huff, Moorlach, Morrell, Nguyen, Nielsen, Stone, Vidak NO VOTE RECORDED: Galgiani, Hueso, McGuire, Pan, Roth, Runner ASSEMBLY FLOOR: Not available SUBJECT: Short-lived climate pollutants SOURCE: Author DIGEST: This bill requires the Air Resources Board (ARB) to approve and implement the comprehensive short-lived climate pollutant strategy to achieve, from 2013 levels, a 40% reduction in methane, a 40% reduction in hydrofluorocarbon gases, and a 50% reduction in anthropogenic black carbon, by 2030. SB 1383 Page 2 Assembly Amendments add new sector-specific targets for organic waste, and methane reductions from the dairy and livestock sector, as well as a number of additional requirements for ARB, and other agencies, in implementing regulations to achieve the emissions targets. Assembly amendments also require state agencies to adopt and consider, as appropriate, policies and incentives to increase the production of renewable gas. ANALYSIS: Existing law: 1) Requires, under the California Global Warming Solutions Act of 2006, ARB to determine the 1990 statewide greenhouse gas (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 emissions reductions measures by regulation (Health and Safety Code §38500 et seq.). 2) Requires ARB to complete, by January 1, 2016, a comprehensive strategy to reduce emissions of short-lived climate pollutants (SLCPs) in the state. This bill: 1) Requires ARB to approve and begin implementing the comprehensive strategy to reduce SLCPs in the state to achieve, from 2013 levels, a 40% reduction in methane, a 40% reduction in hydrofluorocarbon gases, and a 50% reduction in anthropogenic black carbon, by 2030. 2) Requires ARB, prior to approving the strategy, to coordinate with other state and local governments; hold at least three SB 1383 Page 3 public hearings; evaluate the best available scientific, technological, and economic information to ensure the strategy is cost effective and technologically feasible; and incorporate and prioritize, as appropriate, measures and actions that provide cobenefits, as specified. 3) Requires ARB to publicly notice the strategy and post a copy of the strategy on their Internet Web site at least one month prior to approval. 4) Establishes a target of 50% reduction in the statewide disposal of organic waste from the 2014 level by 2020 and a 75% reduction by 2025, and requires CalRecycle and ARB to adopt regulations to achieve the organic waste reduction targets. 5) Prohibits the above regulations from establishing numeric organic waste disposal limits for individual landfills and authorizes the regulation to: a) Require local jurisdictions to impose requirements on generators, as specified, and penalties for noncompliance. b) Include different levels of requirements for local jurisdictions and phased timelines for meeting 2020, and 2025 goals, as specified. c) Include penalties for noncompliance, as specified. 6) Requires the above CalRecycle and ARB regulations to: a) Take effect on or after January 1, 2022, as specified. SB 1383 Page 4 b) Include requirements intended to recover at least 20% of edible food currently disposed of, by 2025. 7) Authorizes a local jurisdiction to charge and collect fees to recover costs incurred in complying with the organic waste reduction targets. 8) Requires CalRecycle, in consultation with ARB, to analyze progress in achieving the organic waste reduction goals, as specified. 9) Authorizes CalRecycle to include incentives or additional requirements in the regulations to facilitate progress in meeting the organic waste reduction goals if CalRecycle determines that significant progress has not been made. 10)Prohibits ARB from adopting additional requirements to control methane emissions from the disposal of organics before January 1, 2025, other than through landfill methane control. 11)Requires ARB, in consultation with the California Department of Food and Agriculture (CDFA) to adopt regulations to reduce methane emissions from livestock and dairy manure management operations by up to 40% below 2013 levels by 2030. 12)Requires ARB, prior to adopting manure management regulations, to do the following: a) Work with stakeholders, as specified, to address challenges and barriers to the development of dairy methane reduction projects. SB 1383 Page 5 b) Hold a minimum of three public meetings, as specified. c) Conduct or consider livestock and dairy operation research on dairy methane reduction projects and consider developing and adopting methane reduction protocols. 13)Requires ARB post a report on their Internet Web site on their progress in meeting with stakeholders, holding public meetings, conducting research, and developing protocols, as required above. 14)Specifies that the regulations shall be implemented on or after January 1, 2024, if ARB, in consultation with CDFA, determines that the regulations are technologically feasible, economically feasible, as specified, and cost effective and that they include provisions to minimize and mitigate potential leakage, and evaluate achievements made by incentives. 15)Requires ARB, in consultation with CDFA, to analyze progress by July 1, 2020, toward achieving the methane reduction targets for the dairy and livestock sector, and authorizes ARB, in consultation with CDFA and stakeholders to reduce the methane reduction goal for the dairy and livestock sector if it is determined that progress has not been made in meeting targets due to insufficient funding, or technical or market barriers. 16)Requires ARB, in consultation with PUC and CEC, to establish energy infrastructure development and procurement policies to encourage dairy biomethane projects to meet the methane reduction goals for that sector, and requires PUC and CEC to direct gas corporations to implement at least five dairy biomethane pilot projects, as specified. 17)Requires ARB to provide guidance on credits generated SB 1383 Page 6 pursuant to the low carbon fuels standard, and cap-and-trade program, and ensure that projects developed prior to implementation of adopted regulations in the dairy and livestock sector receive credit for at least 10 years, and be eligible for an extension of credits, as specified. 18)Requires ARB to develop a pilot financial mechanism to reduce economic uncertainty associated with the value of environmental credits, including credits generated pursuant to the low carbon fuels standard, and cap-and-trade program, and make recommendations, as specified. 19) Specifies enteric emissions reductions may only be achieved through incentive based mechanisms, until ARB, in consultation with CDFA makes specified findings, but authorizes voluntary enteric emissions reductions to be used toward meeting the methane emission reduction goals for the livestock and dairy sector. 20)Specifies that the requirements in adopting dairy and livestock regulations do not limit the authority of ARB to acquire planning and baseline information. 21)Prohibits ARB from adopting methane emission reduction regulations controlling methane emissions from dairy and livestock operation to achieve GHG emissions reductions other than those required pursuant to this bill. 22)Requires CEC, in consultation with ARB and PUC, to develop recommendations for the development and use of renewable gas as part of the 2017 Integrated Energy Policy Report, as specified. 23)Requires state agencies to consider, and as appropriate, adopt policies and incentives to significantly increase the sustainable production and use of renewable gas, based on the SB 1383 Page 7 above recommendations, and requires PUC, in consultation with CEC and ARB, to consider additional policies to support the development and use of renewable gas in the state to reduce short-lived climate pollutants, based on the above recommendations. 24)Requires priority for the consideration and adoption of policies above, be given to fuels with the greatest GHG emissions benefits, as specified. Background 1)Short-lived Climate Pollutants. Greenhouse gases or climate pollutants, such as CO2, work to warm the earth by trapping solar radiation in the earth's atmosphere. Depending on the molecule, these pollutants can vary greatly in their ability to trap heat, which is termed their global warming potential, and the length of time they remain in the atmosphere. CO2 remains in the atmosphere for centuries, which makes it the most critical greenhouse gas to reduce in order to limit long-term climate change. However, climate pollutants including methane, tropospheric ozone, hydrofluorocarbons (HFCs), and soot (black carbon), are relatively short-lived (anywhere from a few days to a few decades), but when measured in terms of how they heat the atmosphere (global warming potential, or GWP), can be tens, hundreds, or even thousands of times greater than that of CO2. These climate forcers are termed short-lived climate pollutants (SLCPs). Because SLCPs remain in the atmosphere for a relatively short period of time, but have a much higher global warming potential than CO2, efforts aimed at reducing their emissions in their near term would result in more immediate climate, air quality, and public health benefits, than a strategy focused solely on CO2. According to ARB's SLCP draft strategy, "while the climate impacts of CO2 reductions take decades or more to materialize, cutting emissions of SLCPs can immediately slow global warming and reduce the impacts of climate change." Recent research estimates that SLCPs are responsible for about SB 1383 Page 8 40% of global warming to date and that actions to reduce SLCP emissions could cut the amount of warming that would occur over the next few decades by half. According to ARB's 2015 updated Scoping Plan and the proposed Short-Lived Climate Pollutant Strategy, the three short-lived climate pollutants with the greatest implications for California are the following: Black carbon: Black carbon, a component of soot, also known as PM 2.5, comes from diesel engines and incomplete burning of carbon sources. Wildfires contribute two-thirds of the total black carbon emissions in the state. In addition to being a powerful global warming pollutant, black carbon is associated with numerous negative health impacts and is designated a potential human carcinogen. Black carbon has a global warming potential 3200 times that of CO2 on a 20-year time scale. Methane: Methane (CH4) is the principal component of natural gas and is also produced biologically under anaerobic conditions in ruminants, landfills, and waste handling. Atmospheric methane concentrations have been increasing as a result of human activities related to agriculture, fossil fuel extraction and distribution, and waste generation and processing. Methane is about 80 times more powerful as a global warming pollutant than CO2 on a 20-year time scale. Hydrofluorocarbons (HFC): HFCs (also known as F-gases) are synthetic gases used in refrigeration, air conditioning, insulation foams, solvents, aerosol products, and fire protection. They are primarily produced for use as substitutes for ozone-depleting substances which are being phased out globally. HFCs, on average, have a global warming potential 1600 times that of CO2 on a 20-year time scale. 2)SLCP Strategy. SB 605 (Lara and Pavley, Chapter 523, Statutes of 2014) directs ARB to develop a comprehensive short-lived climate pollutant strategy by January 1, 2016. In developing the strategy, ARB is required to complete an inventory of sources and emissions of SLCPs in the state based on available data, identify research needs to address data gaps and existing and potential new control measures to reduce SB 1383 Page 9 emissions. In September of 2015, ARB released a draft SLCP strategy required by SB 605, which was updated in April of this year. The proposed strategy sets targets for methane, black carbon, and reductions in F-gases, of 40%, 50%, and 40%, respectively, by 2030. Comments 1)Purpose of Bill. According to the author, "California has been a proud and bold leader in pursuing environmental policies to reduce climate change and address the sources that cause it. Those policies have mostly focused on reducing emissions of CO2, the most significant long-term driver of climate change. This strategy represents the next step in those efforts, to establish a goal to reduce short lived climate pollutants that are among the most harmful emissions to both human health and global climate change. "There is an urgent need to develop a strategy to address and reduce these deadly pollutants. Extensive research links particulate pollution and increased ozone levels to severe and chronic health conditions such as cancer, heart disease, and asthma. This impact is most profound in children. One in eleven children in Los Angeles County suffers from asthma. For black children, the number is one in four. "The impact of air pollution on children is not limited to just heart and lung problems. Asthma is now the leading medical cause of absenteeism in LA schools, impacting children's learning and development. Limited opportunities for physical activity due to respiratory illness and poor air quality also contribute to an epidemic of overweight and childhood diabetes that disproportionally impacts Black and Latino communities. "Although the problem is statewide, these challenges disproportionally impact poor families and communities of color. According to the 2015 State of the Air Report from the American Lung Association, the top five most polluted cities in the United States are all in California. SB 1383 Page 10 "A Southern California Children's Health study that examined the long-term effects of particle pollution on teenagers found that those who grew up in more polluted areas face the increased risk of having underdeveloped lungs, which may never recover to their full capacity. The average drop in lung function was 20 percent below what was expected for the child's age, similar to the impact of growing up in a home with parents who smoked. "Reducing super pollutants in California will have an immediate beneficial effect - dramatically reducing the serious impacts these pollutants have on our air quality and on the health of our children." 2)What measures will be implemented? SB 1383 directs ARB to implement the SLCP strategy, required by January 1, 2016 pursuant to SB 605 (Lara). ARB has not formally approved the SLCP strategy, and it currently exists in draft form. The strategy outlines numerous actions that could be taken, and in some cases are already underway, to address methane, black carbon, and F-gases in the state to meet the 2030 targets. Some of the proposals include: Removal and replacement of old fireplaces and woodstoves; Implementing a sustainable freight strategy; Regulations for best management practices for new dairies; Financial incentives for manure management and dairy digesters; Requiring organics diversion from landfills; Regulations to reduce methane emissions from oil and gas production, processing and storage; Financial incentives for low-GWP refrigeration early adoption; and Bans on the sale of very-high GWP refrigerants and prohibitions on new equipment using high GWP gases. SB 1383 requires ARB to conduct public hearings and ensure the strategy is cost effective and technologically feasible, as well as consider other public health, job growth, and SB 1383 Page 11 technological innovation benefits. Because of the additional actions and evaluations needed, the approved strategy may change significantly, and it is not clear to what extent all the measures and actions identified in the draft strategy will be implemented as part of the approved strategy pursuant to SB 1383 to meet the targets. However, ARB does note in the report that any regulatory measures developed pursuant to the SLCP Strategy would undergo a public rulemaking process, including workshops, and economic and environmental evaluations. FISCAL EFFECT: Appropriation: No Fiscal Com.:YesLocal: No According to the Assembly Appropriations Committee: Unknown cost pressures, potentially in the tens of millions of dollars or more, to fund programs to implement the strategies (Greenhouse Gas Reduction Fund or other special funds). SUPPORT: (Verified8/31/16) Alliance of Nurses for Healthy Environment All Power Labs American Academy of Pediatrics - California American Cancer Society Cancer Action Network, California American Heart Association, California American Lung Association in California Anaergia Asthma Coalition of Los Angeles County Atlas ReFuel Audubon California Bay Area Regional Health Inequities Initiative Baz Allergy, Asthma and Sinus Center, Central Valley and Bay Area Bioenergy Association of California Bonnie J. Addario Lung Cancer Foundation SB 1383 Page 12 Breathe California California Association of Environmental Health Officers California Association of Sanitation Agencies California Bicycle Coalition California Black Health Network, Inc. California Conference of Directors of Environmental Health California Hydrogen Business Council California League of Conservation Voters California Medical Association California Natural Gas Vehicle Coalition Californians Against Waste California Nurses Association California Pan-Ethnic Health Network California Public Health Association - North California Refuse Recycling Council California Thoracic Society California Walks CalPIRG Center for Climate Change and Health, Public Health Institute Central California Asthma Collaborative Clean Energy Renewables Climate Resolve Climate 911 Coalition for Clean Air Coastal Environmental Rights Foundation CR & R Dignity Health Environmental Defense Fund Environment California Harvest Power, Inc. Health Care Without Harm Health African American Families II Health Officers Association of California Inland Empire Disposal Association Long Beach Alliance for Children with Asthma Los Angeles County Department of Public Works Los Angeles County Waste Management Lutheran Office of Public Policy - California Maternal and Child Health Access (Los Angeles) Natural Resources Defense Council Network of Ethnic Physician Organizations Next Gen Climate SB 1383 Page 13 Phoenix Energy Physicians for Social Responsibility, Los Angeles Physicians, Scientists and Engineers Healthy Energy Physicians for Social Responsibility/Sacramento Prevention Institute RAMP and Community Action to Fight Asthma Recology Republic Services, Inc. San Francisco Bay Area Chapter, Physicians for Social Responsibility San Joaquin County Asthma and COPD Coalition Sierra Energy Santa Clara County Public Health Department Solid Waste Association of Orange County St. John's Well Child and Family Centers (Los Angeles) The Trust for Public Land TSS Consultants Voices for Progress West Biofuels 29 Individuals OPPOSITION: (Verified8/31/16) Asian Pacific Environmental Network Association of Home Appliance Manufacturers California Business Properties Association California Chamber of Commerce California Fresh Fruit Association California Grain & Feed Association California Independent Petroleum Association California Manufacturers & Technology Association California Retailers Association Center for Food Safety Center for Race Poverty & the Environment Food and Water Watch Leadership Counsel for Justice and Accountability Communities for a Better Environment Center for Community Action for Environmental Justice Comite ROSAS Committee for a Better Arvin Committee for a Better Shafter SB 1383 Page 14 Delano Guardians Greenfield Walking Group. Lamont Parent Partners Los Angeles County, Solid Waste Management Committee/Integrated Waste Management Task Force National Federation of Independent Business Nisei Farmers League Western Agricultural Processors Association Western Growers Association Western Plant Health Association Western States Petroleum Association Prepared by:Rebecca Newhouse / E.Q. / (916) 651-4108 8/31/16 22:02:54 **** END ****