Senate Select Committee on Climate Change and AB 32 Implementation

December 3, 2013

AB 32 enacted in 2006

Outlines State’s strategy to achieve 2020 GHG goal

Built on a balanced mix of strategies

Acknowledges need for long-term strategy

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AB 32 and the Initial Scoping Plan

Success of Scoping PlanComprehensive suite of strategies applied

to all sectorsRenewable energy currently accounts for

22 percent of state’s electricityGlobal leader in energy efficiencyMost comprehensive Cap-and-Trade

program in world

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Success of Scoping Plan (continued)Renewable fuels, with the help of the

LCFS, displaced more than a billion gallons of gasoline and diesel

Zero emission vehicle regulation and Governor’s Executive Order transforming vehicle fleet

Major strides in sustainable transportation, land use, and housing planning

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AB 32 Scoping Plan UpdateUpdate shows progress to steadily drive down

GHG emissions to 2020 targetSets framework to move beyond 2020Progress will be through regulations, partnerships,

and incentivesUpdate is part of Administration’s overall climate

strategy– Environmental Goals and Policy Report– Safeguarding California– Climate Change Research Plan

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AB 32 Scoping Plan Update-ProcessKey Questions

– How have we done over past 5 years?– What is needed to continue progress to 2020?– What steps are needed to continue emission reductions?

Process developed in consultation with many stakeholders

– Climate Action Team– Local and regional agencies– Business, environmental, EJ, and community-based

organizations

Workshops and opportunities for comment on discussion draft

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Next Steps—Scoping Plan UpdateLate January - Revised Update and Environmental

Assessment Released– EA will be prepared according to requirements of

ARB’s certified program under CEQA– 45-day comment period

February 20-21- Board HearingEA comments due mid-March 2014Respond to EA comments and Board consideration

Spring 2014

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Cap-and-Trade Program

One of a suite of measures to reduce GHG emissions under AB 32

The “cap” limits total GHG emissions from all regulated sources

The “cap” declines over time—reduces emissions

Participants are allowed to “trade” state-issued GHG emissions allowances—creates flexibility, reduces costs of compliance

Works together with command-and-control measures (e.g. traditional regulation)

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OffsetsOffsets represent real, rigorously quantified, additional

greenhouse gas emissions reductions

Two new protocols to reduce emissions of methane, a short lived, high global warming potential greenhouse gas

Mine Methane Capture Protocol

– Capture and destruction of fugitive mine methane

– Potential domestic offset supply of 60 million metric tons (MMtCO2e)

Rice Cultivation Protocol

– Reduce methane emissions from rice cultivation9

Cap-and-Trade Program-Next Steps

Linkage with Québec effective January 1, 2014

Québec auction December 3, 2013

Next California auction February 2014

Finalize current amendments Spring 2014

Anticipated California-Quebec joint auction in 2014

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Cap-and-Trade Auction ProceedsPurpose: Facilitate GHG reductions and where

feasible maximize environmental and economic co-benefits.

Benefits to disadvantaged communitiesFunding source: Auctioning of State-owned

allowances from Cap-and-Trade Program.– Funding amount varies by auction– $532M generated from five auctions to date

3-year Investment PlanAnnual budget process

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Investment Plan Recommendations for Priority Investments

Sustainable Communities &

Clean Transportation

Energy Efficiency &

Clean Energy

Natural Resources &

Waste Diversion

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Latest Understanding of Climate Science

Continuing Progress Beyond 2020Need for Midterm TargetScience supports continued reductionsCalifornia’s 2050 goalEstablishing a 2030 target would:

– Ensure continued progress toward goal– Provide greater levels of market certainty in the

near term– Frame the next suite of emission reduction

measures

Coordination with other agencies, Legislature, stakeholders

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