BILL ANALYSIS
ACR 77
Page 1
ASSEMBLY THIRD READING
ACR 77 (Swanson)
As Amended July 15, 2009
Majority vote
ECONOMIC DEVELOPMENT 7-0
APPROPRIATIONS 17-0
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|Ayes:|V. Manuel Perez, Logue, |Ayes:|De Leon, Conway, Ammiano, |
| |Beall, | | |
| |Bill Berryhill, Block, | |Charles Calderon, Coto, |
| |Huber, Salas | |Davis, Fuentes, Hall, |
| | | |Harkey, Miller, Nielsen, |
| | | |John A. Perez, Skinner, |
| | | |Solorio, Audra |
| | | |Strickland, Torlakson, |
| | | |Hill |
|-----+--------------------------+-----+--------------------------|
| | | | |
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SUMMARY : Calls on the Air Resources Board (ARB) to include a
sector-based workforce impact assessment and mitigation plan
within its analysis of the AB 32 Scoping Plan and related
rulemaking. The analysis is required to include:
1)An analysis of the projected employment impacts of the
proposed measure by industry sector in each of the years
leading up to 2020, and beyond, that specifies, in particular,
the potential for green collar jobs to be located in or
outside California.
2)An identification of the types of jobs that will be created in
California, the industry sectors for which the jobs will be
created, and the wage and benefit levels expected for those
jobs.
3)An identification of the types of jobs, including industry
sectors, that may be lost in California.
4)A plan for providing California workers a training program for
new green technology jobs that are different from the
traditional jobs in energy, transportation, and construction.
EXISTING LAW requires ARB:
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1)To adopt a statewide greenhouse gas emissions (GHG) limit
equivalent to 1990 levels by 2020 and adopt regulations to
achieve maximum technologically feasible and cost-effective
GHG emission reductions.
2)To adopt a "Scoping Plan" for AB 32 implementation by January
1, 2009, including an evaluation of the total potential costs
and total potential economic and non-economic benefits to
California's economy, environment, and public health, using
the best available economic models, emission estimation
techniques, and other scientific methods.
3)When adopting AB 32 regulations, to rely upon the best
available economic and scientific information and its
assessment of existing and projected technological
capabilities.
FISCAL EFFECT : According to the Assembly Appropriations,
incorporating the requested information into the economic
analysis would cost the ARB approximately $3 million in Air
Pollution Control funds.
COMMENTS :
1)Purpose of the resolution: According to the author, AB 32
(Nunez and Pavley), Chapter 488, Statutes of 2006, was a
landmark piece of legislation that set the bar high for
reducing GHG emissions in California. However, without
appropriate implementation, AB 32 could eliminate economic
opportunities for some, in the course of providing
opportunities to others.
According to a U.C. Berkley Center for Labor Research and
Education (UCB) report, more industry-specific and
occupational research is greatly needed to assess the
workforce needs of the state's emerging green economy. In
addition, a report by the Legislative Analyst's Office (LAO)
states that the ARB's economic analysis has weaknesses that
need to be addressed. In order to direct resources to the
proper areas, such as training, retraining, and education
programs that will provide workers with the skill sets
necessary to work in the jobs created by a new green economy,
an accurate analysis is crucial for policymakers.
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The author states that ACR 77 is not meant to undermine the
provisions of AB 32; it was introduced to develop a win-win
scenario. The resolution simply encourages ARB to conduct a
more comprehensive analysis of the impact that AB 32 will have
on jobs in the state, to ensure that California is maintaining
employment opportunities and preparing the workforce for the
emerging green economy.
2)The Scoping Plan: Existing law requires the ARB to approve
and implement a framework for California to reduce GHG
emissions to 1990 levels by 2020 and to reach 80% of 1990 GHG
emission levels by 2050. In December 2008, the ARB approved
the Scoping Plan to begin this work.
ACR 77 asks for further analysis to be considered within the
Scoping Plan, particularly in the area of its impact on
workforce and the related training needs that may occur in
implementing the programs, fees, and regulations identified in
the Scoping Plan. The additional analysis is based on
recommendations by the by the LAO and the UCB, which are
discussed below. Below is a general summary of the Scoping
Plan including a chart of the proposed emission reduction
actions.
---------------------------------------------------------------
| Recommended Greenhouse Gas Reduction Measures | 2020 |
| |Reductions |
| | (MMTCO2E) |
|---------------------------------------------------+-----------|
|Estimated Reductions from the combination of the | 146.7 |
|Cap-and-Trade Program and complementary measures | total |
|including the 12 items below. | |
| | |
|---------------------------------------------------+-----------|
|1. California Light-Duty Vehicle GHG Standards | 31.7 |
|(Transportation Sector) | |
| Implement Pavley standards | |
| Develop Pavley II light-duty vehicle | |
| standards | |
|---------------------------------------------------+-----------|
|2. Energy Efficiency (Electricity & Commercial | 26.3 |
|and Residential Sectors) | |
| Building and appliance energy efficiency | |
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| and conservation | |
| Increase Combined Heat and Power (CHP) | |
| electricity production by 30,000 Wh | |
| Solar Water Heating (AB 1470 goal) | |
|---------------------------------------------------+-----------|
|3. Renewables Portfolio Standard (33% by 2020) | 21.3 |
|(Electricity Sector) | |
|---------------------------------------------------+-----------|
|4. Low Carbon Fuel Standard (Transportation | 15 |
|Sector) | |
|---------------------------------------------------+-----------|
|5. Regional Transportation-Related GHG Targets | 5 |
|---------------------------------------------------+-----------|
|6. Vehicle Efficiency Measures (Transportation | 4.5 |
|Sector) | |
|---------------------------------------------------+-----------|
|7. Goods Movement (Transportation Sector) | 3.7 |
| Ship Electrification at Ports | |
| System-Wide Efficiency Improvements | |
|---------------------------------------------------+-----------|
|8. Million Solar Roofs (Existing Program Target) | 2.1 |
|(Electricity Sector) | |
|---------------------------------------------------+-----------|
|9. Heavy/Medium Duty Vehicles (Transportation | 1.4 |
|Sector) | |
| Heavy-Duty Vehicle GHG Emission Reduction | |
| (Aerodynamic Efficiency) | |
| Medium- and Heavy-Duty Vehicle | |
| Hybridization | |
|---------------------------------------------------+-----------|
|10. High Speed Rail (Transportation Sector) | 1.0 |
|---------------------------------------------------+-----------|
|11. Industrial Measurer for sources covered under | 0.3 |
|the cap-and-trade program including refineries and | |
|energy efficiency and co-benefits audits (various | |
|industry sectors) | |
|---------------------------------------------------+-----------|
|12. Additional reductions necessary to achieve | 34.4 |
|the cap | |
|---------------------------------------------------+-----------|
| | |
|---------------------------------------------------+-----------|
| Estimated Reductions from Uncapped Sources as |27.3 total |
| indicated in 1 to 4 below | |
|---------------------------------------------------+-----------|
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|1. High Global Warming Potential Gas Measures | 20.2 |
|(various sectors) | |
| Reduction of Use, Recapture and Recovery| |
|---------------------------------------------------+-----------|
|2. Sustainable Forests (Forestry Sector) | 5.0 |
|---------------------------------------------------+-----------|
|3. Industrial Sectors not covered under the | 1.1 |
|cap-and-trade program including oil and gas | |
|extraction and transmission | |
|---------------------------------------------------+-----------|
|4. Recycling & Waste including landfill methane | 1.0 |
|capture (Recycling and Waste Sector) | |
|---------------------------------------------------+-----------|
|Total Reductions Counted Toward 2020 Targets | 174 total |
|---------------------------------------------------+-----------|
| | |
|---------------------------------------------------+-----------|
|Other Recommended Measures items 1 to 6 below | 2020 |
| |Reductions |
| | (MMTCO2E) |
|---------------------------------------------------+-----------|
|1. State Government Operations | 1-2 |
|---------------------------------------------------+-----------|
|2. Local Government Actions and Regional GHG | TBD |
|Target | |
|---------------------------------------------------+-----------|
|3. Green Buildings | 26 |
|---------------------------------------------------+-----------|
|4. Recycling and Waste including mandatory | 9 |
|commercial recycling | |
|---------------------------------------------------+-----------|
|5. Water Sector Measures | 4.8 |
|---------------------------------------------------+-----------|
|6. Methane Capture at Large Dairies (Agriculture | 1 |
|Sector) | |
---------------------------------------------------------------
---------------------------------------------------------------
|Source: AB 32 Scoping Plan, CARB, |
|2008 |
| |
---------------------------------------------------------------
In implementing this Scoping Plan, ARB forecast a net gain of
$33 billion in economic activity resulting in $7 billion in
additional GSP. In addition, ARB states that many of the
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measures in the plan will deliver significant gains in energy
efficiency. ARB believes that even with the projected
increases in per unit energy costs, that implementation of the
actions in the Scoping Plan will result in annual savings per
household of between $400 and $500 on average by 2020.
Similar savings are projected in the transportation area. It
is further stated that the state's proactive climate change
policy will create a strong incentive for additional private
investment.
The Scoping Plan also recommends, and the ARB is currently in
the process of adopting, fees to fund the state's
implementation and administration of AB 32. Existing law
specifies that these fees can be assessed on the sources of
GHG emissions which include, but are not limited to:
producers and importers of transportation fuels, refineries,
cement manufacturers importers of out-of-state electricity,
facilities that combust coal, and natural gas utilities and
pipeline owners and operators.
AB 32 implementation costs are estimated by the ARB to be $24
million in 2007-08; $32 million in 2008-09; and $39 million in
2009-10 for a total program start-up cost of $95 million
through June 30, 2010. ARB's proposed AB 32 budget for FY
2009-10 includes funding for 177 personnel years for a variety
of boards and departments, 155 of which are located at ARB.
To the extent that the Scoping Plan has been adequately
prepared, the fee schedule and implementation plans may be
inappropriate.
3)Independent Review of the Scoping Plan: The purpose of the
Scoping Plan is to provide significant background and policy
direction for the state to use in charting a path toward a
lower carbon economy. Questions have arisen about the current
Scoping Plan, however, as to whether ARB has fully addressed
all relevant issues and whether sufficient care has been taken
to choose the most cost-effective, equitable, and least
economically damaging GHG emission reduction actions. These
concerns have been raised by a number of stakeholders
including policy makers, environmental justice groups, and
business and labor organizations.
Due to this heightened scrutiny, a number of independent
reviews were undertaken of the Scoping Plan. The LAO's review
of the Scoping Plan found, among other things, that it was
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inconsistent, incomplete, and contained "rudimentary"
macroeconomic modeling. In conclusion, the LAO recommended
that the Legislature continue its oversight as the ARB further
developed actions related to the Scoping Plan.
UCB's review found that implementation of AB 32 presents
significant challenges to the state and in the absence of
careful and farsighted implementation strategies California
could lose businesses to other regions in the country and
ultimately result in trading well-paying jobs for new jobs of
lesser quality. In addition, the UCB analysis found that the
selected macroeconomic models were inadequate, provided
inconsistent findings, and were not appropriate for fully
capturing data related to dislocation of workers within
specific industries. While, overall, the report supports
ARB's individual policy recommendations, it recommends that
additional steps be taken to protect workers who are likely to
lose jobs.
Analysis Prepared by : Toni Symonds / J., E.D. & E. / (916)
319-2090
FN: 0002621