California will now be the nation’s example for reducing climate change after Governor Jerry Brown signed sweeping legislation yesterday that will require the Golden State to reduce greenhouse gas emissions to 40 percent below the 1990 levels by the year 2030. The law replaces a previous bill signed by then-Governor Arnold Schwarzenegger which required the state to be at 1990 emissions levels by the year 2020.
The law, SB 32, also gives more authority to California’s Air Resources Board to regulate emissions. A separate law the governor also signed yesterday gives lawmakers more power over that board.
AirTalk spoke with Sacramento Bee reporter David Siders, environmental policy analyst Chris Busch, and local business advocate Louis Baglietto about what the new law means and what you need to know about it.
1. What's the push behind the law? It replaces AB 32 signed by Governor Schwarzenegger, which set out what was then considered an ambitious goal of hitting 1990 emission levels by 2020.
David Siders: The Air Resources Board and independent analysts expect state will reach that goal. 2020 is only 4 years away, so this is an effort to extend that to 2030. By passing the legislation, it extends in law the authorization for the Governor’s Administration to implement rules to reach those reductions.
Chris Busch: It’s one of the most ambitious programs in the world. The Germans have a tougher target of 55 percent below 1990 levels by 2030. It’s the same level of ambition as the EU as a whole, so it’s strong but it’s essentially equal to the task at hand given the stakes of climate change.
2. Who's enforcing this?
DS: Primarily the California Air Resources Board. This was a big controversy last year…surrounding how powerful the Air Resources Board is, and it is quite powerful. They will be tasked with implementing it. Because of some companion legislation that the governor also signed yesterday, the legislature gained some more oversight over that board, which was important to mollify some of the skeptics in the legislature.
3. What does this bill say on cap-and-trade?
DS: This bill is deliberately silent on cap-and-trade. The governor had tried to slip into this bill a late amendment authorizing the extension of cap-and-trade but that was rejected by lawmakers and instead the bill is silent. However, the bill could be an important cudgel for Brown in trying to negotiate an extension of cap-and-trade. With the bill, his administration has the authority to implement regulations to reduce emissions. So he can go to industry and say, “We’re going to reduce emissions one way or another. Would you like it this way or that?” Industry might find cap-and-trade or some version of it more appealing than a regulation-only approach.
CB: There’s two ways people can comply with cap-and-trade: Either through the permits that the states has been auctioning, mainly, or from offsets that are from projects such as a forestry project in Alabama or whatever. I have a different take from David. I think that there’s a strong likelihood that this recent package of legislation does enable cap-and-trade to continue. I think cap-and-trade can continue with a few modifications, specifically around how permits are put out into the system and around these offsets which are coming from outside of the state. Cap-and-trade is still in the mix, given this current authority.
4. What are the implications of the law on employment in Southern California?
Louis Baglietto: In the end, what we’ll see is a continuation of reduction in jobs, reduction in new projects across California, specifically in Southern California. One of our main objections to SB 32 is moving the goal post before the game was done. Quite literally, instead of getting to 1990 levels by 2020, we’re now having to go to significantly underneath by 2030. I don’t think the industry has figured out the game plan to get to the 1990 levels. Now we’re facing a much more stringent mandate in a very short amount of time. It would have been a lot better for the state to hold off, analyze how we’ll get to the previous goal before we make a new one. One of the things we’re finding across California is industry jobs under attack under a whole variety of different areas, whether it be $15 an hour, whether it be CEQA lawsuits...and now we have one more regulatory hurdle to jump.
CB: The state, since the end of the recession, has been growing jobs at a 50 percent faster rate than the nation as a whole. There are studies showing that the renewable standards have created 30,000 jobs in some of the hardest hit rural areas of the state. We’re growing the advanced energy giants of the future, multi-billion dollar companies. A majority of global investment in the last two years has been in renewable energy, so I think clearly this is the direction the economy needs to go for sustainable growth.
5. How is the business community responding?
LB: We’re going to come to the table and work with the Air Resources Board to find cost-effective solutions. We have no choice. If you want to do business in California, you have to come to the table and you have to work with the people responsible for creating the future regulations. We’ll be there. We’ve got a great track record of trying to go to Sacramento and inject reality into the discussions. We’re going to try and find a way that we can meet the goals while at the same time try to keep jobs and businesses going in California. The legislature has just made it a lot harder.
This interview has been edited for clarity. You can listen to the full interview by clicking on the audio player at the start of the article.
David Siders, reporter for the Sacramento Bee covering state politics; he tweets from @davidsiders
Chris Busch, research director at San Francisco-based think tank Energy Innovation
Lou Baglietto, Los Angeles County Business Federation Advocacy Committee Chair