California Legislature Sends Climate Change and Clean Air Bills to Governor

This past week, the California legislature sent several important climate change and clean air bills to Governor Brown. The use of natural gas as a transportation fuel could help achieve the emissions reductions set by legislators if industry continues to work with California.

SB32 ratchets up the state’s commitment to reducing greenhouse gas emission by codifying a target that emissions are reduced by 40 percent from 1990 levels by 2030.  California currently is on track to meet an earlier target that greenhouse gas emissions are reduced to 1990 levels by 2020.  SB32 had faced stiff opposition in the legislature from business interests and republicans as well as legislators who felt that climate change legislation has not done enough to help poorer communities.

To shore up support for SB32, legislators and Governor Brown supported adoption of another bill, AB197, a measure that directs California Air Resources Board (CARB) to prioritize disadvantaged communities when adopting climate change regulations, and it also requires CARB to evaluate the cost-effectiveness of regulations.

While both bills extend CARB’s authorities and further underscore the states commitment to reducing greenhouse gas emissions, neither measure specifically extended the states cap-and-trade program. That program currently is at issue in a lawsuit brought by the business community in California, which has argued the program is a tax. If the argument prevails, the legislature would have to authorize the program by two-third majority vote, which could be difficult to achieve. Neither SB32 nor AB197 achieved that level of support. The cap-and-trade program continues to be an important source of revenue for many clean air and climate change initiatives.

Another important bill that was sent to the Governor is AB1613, a bill that directs how discretionary revenue from the cap-and-trade program is to be spent in the next several years.  According to the California Natural Gas Vehicle Coalition (CNGVC), the bill includes $150 million in spending for heavy-duty vehicles and off-road equipment, including $23 million in incentives for new low-NOx trucks and buses. These initiatives are expected to help natural gas buses as are other spending provisions related to public transit vehicles and clean fuel vehicles.

The adoption of these bills would appear to be good news for natural gas vehicles.  The more stringent greenhouse gas targets in particular would appear to favor efforts to expand the use of renewable natural gas.  New low-emission engine entering the market also should help California with its effort to address local air pollution concerns.