BILL ANALYSIS Ó
SENATE COMMITTEE ON ENVIRONMENTAL QUALITY
Senator Wieckowski, Chair
2015 - 2016 Regular
Bill No: SB 1405
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|Author: |Pavley |
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|Version: |4/13/2016 |Hearing | 4/20/2016 |
| | |Date: | |
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|Urgency: |No |Fiscal: |Yes |
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|Consultant:|Rebecca Newhouse |
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SUBJECT: Zero-emission vehicles: transportation systems
ANALYSIS:
Existing law:
1) Provides the California Air Resources Board (ARB) with
primary responsibility for control of mobile source air
pollution, including adoption of rules for reducing vehicle
emissions and the specification of vehicular fuel
composition. (Health and Safety Code §39000 et seq. and
§39500 et seq.)
2) Directs ARB to implement motor vehicle emission standards,
in-use performance standards, and motor vehicle fuel
specifications for the control of air contaminants and
sources of air pollution that ARB finds to be necessary, cost
effective, and technologically feasible, unless preempted by
federal law. (HSC §43013 et seq.)
3) Establishes the Charge Ahead Initiative administered by ARB
with the goals of reaching at least one million zero-emission
and near-zero-emission vehicles by January 1, and increasing
accessibility for disadvantaged, low-income, and
moderate-income communities. ARB is required to establish
programs that further increase access to and direct benefits
for disadvantaged, low-income, and moderate-income
communities and consumers from electric transportation. (HSC
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§44258 et seq.)
4) Under the California Global Warming Solutions Act of 2006,
requires 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. ARB is authorized to include the use of
market-based mechanisms to comply with these regulations.
(HSC §38500 et seq.)
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This bill:
1) Requires ARB to revise regulations relating to zero-emission
vehicle standards to expand the definition of "transportation
systems eligible for zero-emission vehicle credits" to
include entities utilizing fleets of zero-emission vehicles,
including rental car companies, transportation network
companies, taxicab companies, and car-sharing companies, to
the extent their operations involve ridesharing features that
reduce per-passenger emissions.
2) Requires ARB to conduct a study to determine the feasibility
and efficacy of providing grants to transit operators to
subsidize rides for disadvantaged communities through
zero-emission vehicles used by transportation systems
eligible for zero-emission vehicle credits, in a manner that
complements the transit operator's service.
Background
1) Zero Emission Vehicle regulation. The Zero Emission Vehicle
(ZEV) Regulation requires large volume and intermediate
volume vehicle manufacturers that sell cars in California to
produce ZEVs (such as battery electric and fuel cell
vehicles), clean plug-in hybrids, clean hybrids and clean
gasoline vehicles with near-zero tail pipe emissions. In
general, the ZEV regulation requires that 15% of new car
sales be ZEVs by 2025. This target is intended to achieve 1.5
million ZEVs on the road by 2025 as directed under Governor
Brown's Executive Order B-16-2012.
To meet the ZEV requirement under the regulation,
manufacturers selling vehicles in California must offer for
sale a certain percentage of ZEVs each year, or must purchase
credits from other manufacturers. These credits are
generated by manufacturers that supply more ZEVs than the
required amount.
In 2001, the regulation was amended to allow auto
manufacturers to receive additional ZEV credits for
"transportation systems," which the regulation specifies as
projects that demonstrate shared use of ZEVs, and
technologies such as reservation management, card systems,
SB 1405 (Pavley) Page 4
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location management, charge billing and real-time wireless
information systems. Additional ZEV credits are available if
the project also includes linkage to transit.
In general, ZEV credits go to vehicle manufacturers, but the
"transportation systems" credits can be granted to varying
entities. For example, a third-party such as ZipCar can
apply for transportation system ZEV credits and then sell the
ZEV credits in the credit market to any auto manufacturer for
their regulation compliance.
The ability for to receive ZEV credit from transportation
systems expires in 2018.
SB 1405 requires ARB to amend their ZEV regulation to allow
rental car companies, transportation network companies (e.g.,
Uber and Lyft), taxicab companies, and car-sharing companies,
if they use ZEVs fleets with ride-sharing features, to
qualify to receive "transportation system" ZEV credits.
2) Charge Ahead Initiative. SB 1275 (de León, Chapter 530,
Statutes of 2014) establishes the Charge Ahead California
Initiative, which outlines a vision of placing one million
electric cars, trucks, and buses on California's roads by
2023 and directs ARB to provide incentives to increase the
availability of zero-emission vehicles and near-zero-emission
vehicles, particularly in disadvantaged communities.
Pursuant to SB 1275, ARB's FY 2015-16 Low Carbon
Transportation Funding Plan includes, among other programs
and actions: a) $163M for Clean Vehicle Rebate Project (or
CVRP, which provides rebates to consumers for purchasing
electric vehicles) that includes an income cap to exclude
high-income consumers and higher rebate levels for lower
income consumers; b) $37 million for light-duty pilot
projects in disadvantaged communities that are aimed at
increasing access to clean vehicles in disadvantaged
communities and lower-income households. These pilot projects
include expansion of four existing pilot projects established
in 2014, including increased incentives for public fleets to
purchase CVRP-eligible vehicles, advanced technology
car-sharing and mobility options, increased incentives to
replace high-polluting vehicles, and financing assistance.
ARB states that these pilot projects provide consumer
exposure to clean vehicles in these communities and
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opportunities for ownership through purchase incentives and
financing.
Specifically, ARB allocated $2.5 million in 2014-15, and $5
million in 2015-16 for a car sharing and mobility option
pilot project for clean car sharing fleets in or near
disadvantaged communities to offer an alternate mode of
transportation and encourage the use of advanced technology
cars, including plug-in hybrid electric vehicles (PHEVs),
battery electric vehicles (BEVs), and fuel cell electric
vehicles (FCEVs). The project will gather data that could
help support future larger scale advanced technology car
share programs.
Additionally, ARB proposed $3 million for a pilot project to
provide incentives for the purchase of zero- or near-zero
emission vehicles for agricultural worker vanpools in the San
Joaquin Valley.
ARB is currently holding workshops to develop their funding
plan for 2016-17.
The Governor's proposed FY 2016-17 Budget includes $500
million for ARB to continue Low Carbon Transportation
investments. Some fraction of the $500, at the same or
increased funding as FY 2015-16, will likely be available to
continue the five light-duty pilot projects in disadvantaged
communities
Comments
1) Purpose of Bill. According to the author, "California's Zero
Emission Vehicle (ZEV) program has driven a critical set of
innovations in transportation technology. But if we are
serious about meeting the Governor's goals to reach 1.5
million zero-emission vehicles by 2025, and to provide broad
access to these vehicles in all communities, we will need to
significantly augment our efforts in building consumer
awareness, and deploying vehicles in disadvantaged areas.
"The ZEV mandate created a market to incentivize low
emissions technology. In its most basic form, auto
manufacturers who produce ZEVs earn credits toward their
obligation, and are able to sell any excess credits to auto
manufacturers who don't produce as many ZEVs and therefore
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must meet their obligation by buying others'. (For example,
a fictional hypothetical: Nissan sells credits earned from
the production of its Leaf to Ford, which needs to buy
credits to compensate for sales of its F-series trucks.)
"ZEV's 2001 regulations created a "Transportation Systems"
category to allow carsharing and stationary car deployment to
provide auto manufacturers with extra credits for deploying
ZEVs in high-exposure and transit-linked areas - the
regulation did this to increase consumer awareness, and there
is evidence that proves it accomplished this goal. While the
ZEV program anticipated some technological changes in the
transportation industry, its current regulatory framework is
far behind today's trend toward a multi-modal and
mobility-driven model. There is now a critical opportunity
to supercharge consumer awareness and increase access to ZEV
technology in low- and middle-income neighborhoods by simply
updating the regulations to more accurately capture today's
Transportation Systems.
"SB 1405 brings the ZEV regulations into alignment with
modern transportation trends by updating the "Transportation
System" definition in the existing CARB ZEV Mandate
regulations to include more and larger vehicle fleets,
including, for example, taxi cab companies, rental car
companies, and transportation network companies."
The bill also requires ARB to conduct a study relating to
transit-subsidized rides on ZEV-credit-qualified
transportation systems serving disadvantaged communities.
According to the author, the study aims to examine the
feasibility of these projects to help address the particular
transportation needs of disadvantaged communities and
increase access to, and awareness of, clean transportation in
low-income neighborhoods.
2) Study. As noted in the background, SB 1275 requires ARB to
establish programs that further increase access to and direct
benefits for disadvantaged, low-income, and moderate-income
communities and consumers from electric transportation.
Pursuant to SB 1275, ARB has established several pilot
projects. These projects include increased incentives for
public fleets to purchase CVRP-eligible vehicles, advanced
technology car-sharing and mobility options, increased
SB 1405 (Pavley) Page 7
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incentives to replace high-polluting vehicles, and financing
assistance.
SB 1405 requires ARB to study the possibility of providing
grants to subsidize rides serving disadvantaged communities
through the use of ZEVs in car sharing programs offered by
transportation network companies, like Uber and Lyft, taxicab
companies and rental car companies.
In requiring the study, the bill aims to examine whether
those additional grants would provide broad access to ZEVs in
all communities in order to significantly augment efforts in
building consumer awareness and deploying clean vehicles in
disadvantaged areas.
Related/Prior Legislation
SB 1275 (de León, Chapter 530, Statutes of 2014) established the
Charge Ahead California Initiative under ARB to provide
incentives to increase the availability of zero-emission
vehicles and near-zero-emission vehicles, particularly in
disadvantaged communities.
DOUBLE REFERRAL:
This measure will be considered in the Senate Transportation and
Housing Committee on April 19, 2016.
SOURCE: Author
SUPPORT:
TechNet
OPPOSITION:
None received
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