june working council · 6/6/2017 · period, companies nearing the cap would sit on their...

June Working Council

Hosted by Intersil

Joint Environment & Energy Committee Meeting

June 2017

Welcome & Introductions

Blair Swezey

Heidi Sickler

New Energy & Environment Senior Associate

Top 2017 Committee Priority Extending C&T Beyond 2020

Extending Cap & Trade Beyond 2020 • Allows businesses to achieve

reductions at least cost

• Maintains clear and consistent policy signal for long-term, stable investment climate

• Continues California’s track record of success

• CA on track to meet 2020 goals but the C&T program will be required to meet future, more stringent goals.

• Time of tremendous uncertainty with significant federal policy changes being proposed by the Trump Administration.

• CA needs to send a strong signal to the business community that it will stay the course on one of the most effective and efficient climate initiatives.

• C&T is driving community investments and economic activity such as clean energy investment throughout our state.

• Positive economic impacts cut across the many sectors and geographies of the California economy that are represented by this coalition.

Extending Cap & Trade Beyond 2020

Update from Sacramento

Kris Rosa, Noteware Gov’t Relations

Legislative Vehicles: C&T Extension SB 775 (Wieckowski)

Issues: • Removes Hard Emissions Cap & Function Instead as a Tax: Instead of

making a fixed # of allowances available each year; state would sell as many pollution permits as covered entities want to buy. Q: How do we ensure we are meeting SB 32 targets? Essentially a tax and dividend bill.

• Create a Border-Adjustment Tax: Levied on imports according to pollution intensity to ensure CA companies on level playing field. Would create complicated new bureaucracy to calculate carbon intensity of entire industries and products. That is, if it survives legal scrutiny.

• Limits Flexibility to Attain Least-cost Compliance: Companies prohibited from banking allowances and prohibited from using pollution offsets. Potentially raises compliance costs.

Legislative Vehicles: C&T Extension SB 775 (Wieckowski) Cont’d

Issues:

• Can Actually Increase (rather than decrease) Market Volatility: Create unnecessary price volatility, because by the end of the 1yr compliance period, companies nearing the cap would sit on their allowances, which could create unnecessary price volatility because markets would engage in hedging.

• Jeopardizes Market Linkage & CA's Partnerships: If allowances are completely prohibited, CA’s international linkages could be jeopardized. Asking global partners to align their programs in a unilateral fashion could hinder the state’s position as a clean energy leader.

Legislative Vehicles: C&T Extension AB 378 (Garica, Holden, Garcia)

Issues: • Cripple the Current State Program: If emissions caps are set on individual

facilities, rather than statewide for all facilities, this would severely cripple the state C&T program. Note: Language was later struck.

• Restricts Trading: The bill proposes to institute a “no-trade zone” for facilities contributing to a “cumulative pollution burden*”, potentially preventing the purchase or sale of carbon market allowances.

*This language is unclear and, as yet, undefined

• Introduce Regulatory Duplication and Increase Complexity: A parallel structure is proposed in that both the state Air Resources Board and local and regional Air Districts would separately oversee each facility.

Progressive Business Alliance

Coalition supports extension of CA C&T program because it:

1. Provides market certainty & regulatory continuity for businesses. 2. Reduces GHGs at least cost. 3. Results in certain, quantifiable GHG emission reductions. 4. Creates an opportunity to maximize investments in carbon

reduction programs that create jobs and economic growth. 5. Complements CA’s direct emission reduction rules and laws. 6. Builds on successful program. 7. Encourages linkages to markets in other jurisdictions. 8. Flexible program that can be strengthened to generate greater

emissions reductions over time if needed. 9. Provides revenues, when distributed appropriately, to bring

clean energy investments to disadvantaged communities.

Business Alliance Supports C&T

Business Alliance C&T Principles As amendments to the current program are considered, encourage integration of the following key principles:

1. Hard Pollution Cap – A hard & declining climate pollution cap must be in place to ensure CA’s pollution reduction goals met

2. Cost Containment – Combination of cost containment measures such as offsets, banking of allowances, and allowance reserves should be utilized. – Can also consider a high price ceiling as part of a price collar system

3. Linkages – Continue linkages with existing programs & encourage linkages & partnerships with new jurisdictions


4. Complementary Programs – Programs such as LCFS should continue and not be weakened

5. Climate Pollutants – Program must continue to focus on GHG reduction. A C&T program shouldn’t take on too many “jobs,” resulting in less effective GHG pollution reductions.

6. Support Complementary Measures – Independent of C&T, we must address other air quality and health concerns of EJ and low-income communities disproportionately impacted by harmful emissions from covered entities


7. Smart Climate Investments – Adequate funding should continue to go to low-income areas, to continue investments in CA’s growing clean economy. – Any tweak of current funding structure should consider:

• Clean energy R&D, • Workforce development • Could consider directing some additional dividend to offset any

potential increases in energy costs and offer an economy-wide stimulus;

Cap and Trade Auction Revenue

SVLG recommends prioritizing GGRF $ for programs that:

1. Reduce GHG emissions in the near term

2. Fuel regional economic growth

3. Leverage private investment

4. Are complementary to existing programs and initiatives

C&T Expenditure Priorities (Adopted in 2014 )

This led us to recommend the following projects as high priorities for expenditure of these funds:

1. BART to Silicon Valley

2. Electrification of CalTrain

3. Funding a Green Bank

4. Protecting San Francisco Baylands

5. Implementing Sustainable Communities strategies, including incentives for housing near transit hubs

C&T Expenditure Priorities Cont’d

Environmental Sustainability Plan (ESP)

SVLG Energy & Environment Committee June 15th 2017

City of San José Environmental Sustainability Plan DRAFT FOR DISCUSSION 21

Agenda for June 15th

Objectives 1. Present the Environmental Sustainability Plan (ESP)

scope

2. Discuss your organization’s role

3. Identify how this committee can support the ESP

City of San José Environmental Sustainability Plan

ESP Drivers

22

Update 2007 Green Vision to…

…align with Paris Agreement

…align with CA State regulations AB 32 and SB 32

…engage whole city (not just municipal

operations)


Three Focus Areas

23

Energy

Mobility

Water


Design ESP in a Way that Enhances The Good Life 2.0

24


Business Impacts

25

Energy

Mobility

Water

• Over 60% of greenhouse gas (GHG) emissions associated with energy usage

• Over 30% of water usage in San José

• 25% of GHG emissions associated with mobility come from local delivery and heavy duty vehicles


• June: Community presentations, engagement at events, and survey; alignment on ESP measures

• July: Draft ESP

• August: Council Study Session (8/21); open public comment period

• September: Finalize ESP

• Fall/ Winter 2017: Council review of ESP

Next Steps

26


1. What is the best way to keep businesses engaged in the process?

2. How do you envision your organization’s role in the ESP implementation?

3. How can the City best support your organization?

Questions for Feedback

27

Discussion

Environment Committee Meeting

Approval of Committee Meeting Minutes

Legislative / Regulatory Items

SB 424 (Allen): CA Regional Env Education Community Network

(CREEC)

Issue: Should the Department of Education increase funding for the California Regional Environmental Education Community Network to expand access to environmental literacy resources for K-12 students? Staff Recommendation: Support. Note – SVLG Education Cmtee recommends support

Summary: • Dedicates $4.5 million in Prop 98 funding to

expand CREEC • Increases the number of regional CREEC

coordinators from 16 part-time to 15 full-time coordinators to: – Map the landscape of environmental literacy

resources – Promote resources to school districts – Connect schools with community-based

providers to integrate environmental literacy into their curriculum

SB 424, CREEC Cont’d

Status: • Passed in the Senate on May 31st • Currently in the Assembly • In early June, the Conference Committee allocated $4 M for SB 424 • Includes $1.5 M for the creation of environmental literacy materials • Senator Allen is actively looking at whether the California License Plate Fund could be a more appropriate source for the bill


According to the CDE’s 2015 environmental literacy survey of 520 schools: • Only 13% of schools had integrated environmental literacy into their curriculum • Absence of environmental literacy is more prominent in underserved communities • Lack of environmental literacy places students at a disadvantage to access green technology jobs


K-12 learning activities SB 424 would help support

• Professional development for K-12 teachers provided by environmental organizations

• Hands-on field trips for students to aquariums, science museums and state parks

• Next Generation of Science Standards-aligned curricula for classroom instruction


Discussion

AB 891 (E. Garcia) CA Communities Environmental Health Screening Issue Implements additional air monitoring stations in the CA-Mexico border region and extends current studies in the region to improve environmental health data.

Details • Requires Office of Environmental Health Hazard Assessment (OEHHA) to

include 1yr of data from San Ysidro Air Quality and Border Traffic Study and Imperial County Air Quality Study in the next update to CalEnviroScreen.

• Implements add’l permanent air monitoring stations in San Diego & Imperial Counties to collect data on PM2.5, ozone, and diesel particulate matter.

• Requires the CA Air Resources Board to submit a report to the Legislature by January 1, 2019 detailing findings from the studies, barriers to data collection, and plans for future data collection.

Staff Recommendation: Support

AB 891 Cont’d Background • Greenhouse Gas Reduction Fund (GGRF): 25% of the $ goes to projects

benefitting disadvantaged communities. Author believes conditions region conditions are worse than believed, so funds aren’t allocated appropriately.

• CalEnviroScreen: Tool identifies disadvantaged communities to help allocate GGRF $. It does not measure pollution originating in Mexico that affects people living in the border region, so there is a need for more data.

Analysis – Areas of Impact • Cap-and-Trade (C&T)

• Environmental Justice (EJ) community will be important in attaining 2/3 vote on C&T extension. AB 891 addresses EJ concerns about pollution burden often borne by disadvantaged communities.

• Access to clean air: • Helps ensure that all Californians have clean air to breathe, especially

those who live in areas where these is heavy pollution.

Status: Ordered to the Senate Committee on Environmental Quality. Passed off Assembly floor 77-0-3 on 5/30/17.

CalEnviroScreen 3.0- 25% most disadvantaged communities 2017

Discussion

AB 1073 (E. Garcia) Clean Truck Program Funding

Issue Extends, until Jan. 1, 2023, requirement that 20% of the funding for the California Clean Truck, Bus, and Off-Road Vehicle and Equipment Technology Program (Clean Truck Program) must be allocated towards deployment of zero- and near-zero emission technologies for medium- and heavy-duty vehicles.

Details • SB 1204 establishes The Clean Truck Program, which supports the development,

and early commercial deployment of zero- and near-zero emission technologies in medium- and heavy-duty vehicles. This includes trucks, buses, and off-road vehicles in port, agriculture, marine, and rail industries.

• A provision of the bill specifies that 20% of program funding must go to the deployment of the technologies in an effort to benefit disadvantaged communities as soon as possible. This provision sunsets on January 1, 2018. AB 1073 would it to January 1, 2023.

Staff Recommendation: Support

AB 1073 Cont’d Background • Greenhouse Gas Reduction Fund (GGRF) Proceeds from the cap-and-trade (C&T)

program are allocated to projects that further reduce GHG emissions. • Low Carbon Transportation programs The Clean Truck Program falls under the

umbrella of Low Carbon Transportation programs funded by the GGRF and administered by the California Air Resources Board

Analysis – Areas of Impact • Cap-and-Trade

• AB 1073 addresses concerns from the environmental justice community about unfair distributions in the C&T pollution burden. As Gov. Brown is seeking 2/3 vote on a C&T extension, it is important to align with this community.

• Meeting AB 32 and SB 32 emissions goals • Transportation sector accounts for 38% of CA’s GHG emissions. AB 1073 continues

to promote deployment of innovative technologies to make trucking fleets more efficient for the benefit of industry, communities, and CA’s GHG emission goals

Status: Passed off Assembly floor 77-0-3 on 5/11/17. Passed Sen Cmte on Transpo. & Housing 12-0-1 on 6/13/17, re-referred to the Committee on Environmental Quality.

Clean Truck Program Significant Figures • In fiscal year 2016-17, $369 million of

$1.113 billion in GGRF monies went to Low Carbon Transportation programs

• $13.4 million to zero-emission truck and bus pilot programs, with $8.8 million leveraged from additional sources

From the California Climate Initiative 2017 Annual Report to the Legislature

Case: Port of Lose Angeles Green Omni Terminal

• Busiest port in the U.S. • A project to clean up the port launched

in 2016 • Pertinent to AB 1073:

o Port has new and retro-fitted zero-emission battery-electric trucks and cargo handling equipment that includes four electrified yard tractors, two high-tonnage fork lifts, two drayage trucks, and a top handler

• Project is expected to reduce more than 3,200 MTCO2e per year, and nearly 28 tons per year of other emissions

Discussion

Top Committee Priority: CA WaterFiX

No More Rainchecks

CA WaterFix Issue: Current Delta system is outdated, at risk of collapse, and often unable to provide water deliveries to contractors throughout the state.

Solution: Place two 40 foot tunnels in the northern part of the Delta. Located 7 feet above sea level to mitigate intrusion from rising sea levels.

SVLG supports CA WaterFix (CWF): 95 % of drinking water and 40 % of overall water supply for the South Bay flows through aging Delta Water system.

Purpose: • Modernize infrastructure to protect against natural disasters. • Allow us to more efficiently capture, store, and move water during wet

years to stabilize supply during drought years. • The closely related “CA Eco Restore” plan will help stabilize Delta’s

vulnerable ecosystem.

Additional Information: Santa Clara County voters overwhelmingly approve. EMC Research, 77% approval rating. Economic Impacts: • Estimated $14-17 Billion dollar project, funded by

Public Water Agencies (water users). • According to CWF sources, urban water users can

expect a $5/month increase on water bill.

CA WaterFix

Timeline and Next Steps April-June 2015

• (April) Governor Brown introduces CWF and sister plan CA Eco Restore, as separate entities. (Previously BDCP)

• (June) SVLG supports CWF.

December 2016

• DWR completes final EIR, CWF has undergone 3 EV reviews and 341 days of public review.

June 2017

• Agencies to release “biological opinions” on EV impacts of the tunnels, & whether the project needs to be reworked. (next week).

September 2017

• Public Water Agencies, including Santa Clara Valley Water District will vote on whether to fund CWF.

Engagement with Santa Clara Valley Water District (District): • Governor Brown pushing for immediate vote of approval (September deadline) • District staff requests of Administration that CWF be supported by complimentary actions

to add flexibility, cost-controls, and system efficiency, to secure Board approval: • Expedited Project Permitting for certain projects through accelerated timeline for

processing permits and mitigation requirements consistent with CEQA. • Funding for Regional Storage Projects that align with CWF objectives.

Next steps for SVLG: The Leadership Group will continue to work with the Administration and Santa Clara Valley Water District to ensure the project moves forward, provided it is economically feasible, and has a robust management plan.

Open forum / Items of interest / Announcements

june working council · 6/6/2017 · period, companies nearing the cap would sit on their...

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