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Revenue generated by this year’s greenhouse gas auctions continues to be the subject of legislation, although the latest California budget blueprint directs that the monies be temporarily loaned to the General Fund. Legislation debated and passed by the Assembly Natural Resources Committee Aug. 12 directs that $125 million of the California Air Resources Board’s cap-and-trade revenue in the 2013-14 cycle be directed to projects cutting methane, black carbon and other greenhouse gas emissions in highly polluted, financially distressed communities. Resources Committee chair Assemblymember Wes Chesbro (D-North Coast) noted the state’s “confused expenditure plans” for the auction proceeds. He supported passing Sen. Ricardo Lara’s (D-Long Beach) SB 605, explaining, “We need a bigger discussion of the bigger spending plan and this [bill] is an important part.” SB 605 targets emission reductions in disadvantaged communities primarily, in Los Angeles, the Central Valley and Sacramento, Lara said. His bill directs the Air Board to fund projects that reduce the far more potent greenhouse pollutants, methane and black carbon. “Focusing on these pollutants has the co-benefits of reducing air pollution and improving public health,” said V. John White, Center for Energy Efficiency & Renewable Technologies executive director. These pollutants, which exacerbate asthma, result in about 30,000 hospitalizations a year in California at a cost of $763 million, according to Physicians for Social Responsibility. While a long list of clean air and public health and community advocates supported the bill, it faced opposition primarily from large business organizations, including the California Chamber of Commerce and oil companies. Much of their opposition is based on these groups’ ongoing legal challenge to the Air Board’s authority to auction greenhouse gas emissions under the state’s climate protection law, AB 32. SB 605 was amended in committee to eliminate its prohibition on use of out-of-state offset projects to comply with California’s greenhouse gas cap. The liberalized offset project parameters generated considerable opposition, including from the Environmental Defense Fund. The revenue from the first four auctions is to be spent by next June under the measure. The bill passed on a 6-0 vote. The committee also approved SB 591, which allows the Merced Irrigation District to reduce its 33 percent renewable mandate obligation if it supplies more than 70 percent of its demand with power from its large hydropower facility. For example, if the Exchequer project produces 70 percent of the district’s power, its renewable mandate would drop to 30 percent. But, if it meets 100 percent of its power needs from hydropower, its renewables obligation would be fully met under the 33 percent renewables law. “It recognizes that one size doesn’t fit all,” said Sen. Anthony Cannella (R-Merced), SB 591 author. The crux of the opposition to the bill focused on ensuring that it does not set a precedent that undermines the state’s 33 percent renewables portfolio standard. Cannella agreed to include language in SB 591, stating it was not creating a legal example. The bill passed 6-0. Another approved measure extends the life of a decades-old loan program at the California Energy Commission to advance energy efficiency and renewable retrofits at public buildings, schools and hospitals. SB 39 by Sen. Kevin de Leon (D-Los Angeles) initially focused on how to divvy up the energy efficiency funds under the voter approved Prop. 39. It now extends the life of the Energy Conservation Assistance Act at the Energy Commission from 2018 to 2022. The low-interest revolving loan program, created in 1979, has spent more than $300 million to fund retrofit projects at about 800 entities, according to the bill analysis. Funding for the projects has come from a variety of sources, including the general fund, the federal Petroleum Violation Escrow Account, tax-exempt revenue bonds and the American Recovery & Reinvestment Act of 2009. Also approved was SB 11 by Sen. Fran Pavley (D-Agoura Hills). It reauthorizes the Carl Moyer program at the Air Board, which funds programs to slash diesel emissions from trucks, off-road vehicles and farms.

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