Environment and Natural Resources

Energy and Climate Change

The Global Warming Solutions Act of 2006 (Chapter 488 [AB 32, Núñez/Pavley]), commonly referred to as AB 32, established the goal of reducing greenhouse gas (GHG) emissions statewide to 1990 levels by 2020. Subsequently, SB 32 (Chapter 249, Statutes of 2016 [Pavley]) reduced the GHG emission target by an additional 40 percent by 2030.The Air Resources Board (ARB) has developed a wide variety of regulations and programs intended to reduce GHG emissions, including a cap-and-trade program.

The cap-and-trade program places a “cap” on aggregate GHG emissions from large GHG emitters. The cap declines over time, ultimately arriving at the target emission level in 2030. To implement the cap-and-trade program, ARB allocates a number of carbon allowances equal to the cap, and each allowance is essentially a permit to emit one ton of carbon dioxide (or the equivalent amount for other GHGs). The ARB provides some allowances for free, making others available for purchase at quarterly auctions. Entities can also “trade” (buy and sell on the open market) the allowances in order to obtain enough to cover their total emissions for a given period of time.

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ENERGY


Electricity Comes from Various Sources

Electricity Comes from Various Sources

Major State Spending on Energy Efficiency, Alternative Energy, and Mobile Source Emissions Reductionsa

(In Millions)

Category/Program

Description

Agency

Estimated 2017-18 Spending

Energy Efficiency

IOU Energy Efficiency Programs

Programs to increase energy efficiency and transform technology markets within California using ratepayer funds.

CPUC

$1,000

Clean Energy Jobs Act—Proposition 39

Grants for schools and community colleges for energy efficiency and clean energy projects.

CDE/CCC

423

Energy Savings Assistance Program

Energy efficiency program for low-income IOU customers, including weatherization, minor home repairs, and energy education.

CPUC

373

Alternative Energy

IOU Self Generation Incentive Program

Rebates for qualifying distributed energy systems installed on the customers’ side of the utility meter, including fuel cells and energy storage systems.

CPUC

$189

Electric Program Investment Chargeb

Funding for applied research and development, technology demonstration and deployment, and market facilitation for clean energy technologies.

CEC

125

Dairy Digester Research and Development

Grants to implement dairy digesters that reduce methane emissions from dairy manure in California.

CDFA

99

New Solar Homes Partnership

Incentives for installation of eligible solar energy systems on new residential construction.

CEC

96

Incentives for food processors

Incentives for emission reductions from food processing facilities.

CEC

60

Public Interest Natural Gas Research, Development and Demonstration Program

Research, development and demonstration program to advance science or technology for clean energy innovations related to natural gas use.

CEC

28

Mobile Source Emission Reductions

Heavy Duty Vehicles and Off-Road Equipment

Programs that promote low-emission heavy-duty vehicles and equipment, including freight demonstration projects, vouchers for trucks and buses, and truck and bus pilots.

ARB

$398

Carl Moyer Program and other local air district programs

Grants administered by local air districts for cleaner-than-required engines, equipment, and other sources of air pollution.

ARB

319

Light-duty vehicles

Includes rebates for zero-emission vehicles, additional incentives for certain low- and moderate-income households purchasing cleaner vehicles, and other programs to reduce transportation emissions in disadvantaged communities.

ARB

265

Agricultural equipment

Incentives to promote low-emission agricultural equipment

ARB

135

Alternative and Renewable Fuel and Vehicle Technology Program

Incentives to develop and deploy alternative vehicle technologies and renewable fuels.

CEC

97

IOU electric vehicle infrastructure pilots

Pilot programs to support electric vehicle charging in various locations, such as apartment buildings and workplaces.

CPUC

86

aDoes not include most Volkswagen settlement funding or public transit-related programs.

bDoes not include funds allocated to utilities.

IOU = Investor-Owned Utility; CPUC = California Public Utilities Commission; CDE = California Department of Education; CCC = California Community Colleges; CEC = California Energy Commission; CDFA = California Department of Food and Agriculture ; and ARB = Air Resources Board.


GREENHOUSE GAS EMISSIONS


Greenhouse Gas Emissions Come From Various Sources

Greenhouse Gas Emissions Come From Various Sources

For more information, please see Air Resources Board Emissions Inventory

 

State Law Requires More Greenhouse Gas Reductions by 2030

Recent Legislation Requires More Greenhouse Gas Reductions by 2030

 


CAP-AND-TRADE


Cap-and-Trade Regulation Ensures Emissions Do Not Exceed Limit

Cap-and-Trade Regulation Ensures Emissions Do Not Exceed Limit

For more information, please see The 2017-18 Budget: Cap-and-Trade

 

Allowances Offered and Purchased at Auctions

Allowances Offered and Purchased at Auctions

For more information, please see California Air Resources Board Auction Information.

 

State Revenue From Cap-and-Trade Auctions

State Revenue From Cap-and-Trade Auctions

For more information, please see California Air Resources Board Auction Public Proceeds Report.

 

2017-18 Cap-and-Trade Spending Plan

(In Millions)

Beginning Fund Balance

$854

 

Estimated Revenuea

$3,000

 

Total Expenditures

$3,324

Continuous Appropriationsb

Department/Agency

$1,752

High-speed rail

High Speed Rail Authority

$730

Affordable housing and sustainable communities

Strategic Growth Council

584

Transit and intercity rail capital

Transportation Agency

292

Transit operations

Department of Transportation

146

Budget Act Appropriations

Department/Agency

$1,572

Mobile Source Emissions

Freight and heavy duty vehicle incentives

Air Resources Board

$320

Local air district programs for clean engines

Air Resources Board

250

Clean Vehicle Rebate Project

Air Resources Board

140

Low-income light duty vehicles and school buses

Air Resources Board

100

Forestry

Forest health and fire prevention

CalFire

200

SRA fee backfill

CalFire/Conservation Corps

80

Local fire prevention grants

Office of Emergency Services

25

Urban forestry

CalFire

20

Agriculture

Methane reductions from dairies

Food and Agriculture

99

Agricultural equipment

Air Resources Board

85

Incentives for food processors

Energy Commission

60

Agricultural renewable energy

Energy Commission

6

Other Programs

Waste diversion

CalRecycle

40

Urban greening

Natural Resources Agency

26

Natural lands climate adaptation

Wildlife Conservation Board

20

Low income weatherization and solar

Community Services and Development

18

AB 617c implementation

Air Resources Board

17

Wetland restoration

Department of Fish and Wildlife

15

Climate and energy research

Office of Planning and Research

11

Transformative Climate Communities

Office of Planning and Research

10

Coastal climate adaptation

Various agencies

6

Other administration

Various agencies

24

Ending Fund Balance

$530

aLAO estimate.

bAmount depends on actual 2017-18 revenue.

cChapter 136 of 2017 (C. Garcia).

CalFire = Department of Forestry and Fire Protection; SRA = state responsibility area; and CalRecycle = California Department of Resources Recycling and Recovery.

 

Last Updated: December 2017