It’s the Capitol: Greenhouse Gas Package Lands on Gov.’s Desk

By Published On: September 7, 2012

Significant legislation setting parameters on the allocation of the state’s carbon cap-and-trade revenue barely survived the upstream swim to the governor’s desk. The fate of Assembly Speaker John Pérez’s (D-Los Angeles) greenhouse gas revenue bill, AB 1532, was tied to a measure that just squeaked by. The joined measure requires 25 percent of the cap-and-trade auction revenue be used to reduce emissions in economically and environmentally challenged communities. On the final day of the legislative session, Sen. Kevin De León’s (D-Los Angeles) SB 535 was sent back to the Rules Committee just before the legislative cutoff. The lawmaker’s two-year bill managed to pass at 11:55 PM Aug. 31. It won a 25-14 vote in the Senate, and passed 43-29 on the Assembly Floor. Pérez’s umbrella legislation, AB 1532, specifies that funds reaped from the California Air Resources Board cap-and-trade market, expected to be launched Nov. 14, are to be used to reduce greenhouse gases in the state pursuant to the state’s climate protection law AB 32. Qualifying investments include those promoting energy efficiency, alternative energy, energy storage technologies, carbon lite transportation strategies, and sustainable development. Approved 21-15 by the Senate and 51-28 by the Assembly earlier on Aug. 31, it also sets up a public process for adopting the investment plan and an annual reporting requirement. The Department of Finance is directed to develop a three-year investment plan with input from the Air Board and California Public Utilities Commission. The first year’s plan is to be part the governor’s 2013-14 budget proposal. The expectation is that the quarterly carbon market is set to cut greenhouse gases by 18 million metric tons by 2020--equal 10 percent of the emission cuts needed to reach AB 32’s goals of 1990 emission levels in California. The market includes only 10 percent of the emission allocations auctioned, with the rest given away for free. Under SB 535, the California Environmental Protection Agency is to define “disadvantaged communities” using socio-economic and environmental criteria. At least 10 percent of the funds set aside for emission reductions for poor, polluted communities are to “directly” benefit these communities. A number of other bills were passed at the end of last week and sent to the governor including: SB 1122 by Sen. Mike Rubio (D-Fresno) creates a market niche for 250 MW of biomethane for investor-owned utilities. It aims to allow biomass projects to compete against similar technologies when bidding for utility deals. SB 1268 by Sen. Fran Pavley (D-Agoura Hills) extends by five years--to 2018--a low-interest loan program to government buildings and school, which is administered by the California Energy Commission. AB 2196 by Assemblymember Joan Buchanan (D-San Ramon) expands the eligibility of California Solar Initiative incentives to solar thermal projects. It passed the Assembly Aug. 31 on a 52-25 vote. Also approved was Assembly Joint Resolution 35 by Assemblymember Das Williams (D-Santa Barbara) urging federal lawmakers to pass legislation restricting exports of coal for electricity generation to countries lacking greenhouse gas emissions reduction rules. The Assembly passed it 49-26 in spite of vocal opposition from Republicans last week. The governor has 30 days to sign or veto bills on his desk. Unsigned bills automatically become law.

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