michele something from nothing tcs 2015
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CAP & TRADE IN CALIFORNIAHOW THE GOLDEN STATE IS BRINGING IN THE GOLD FOR TRANSPORTATION
cap & trade 101
California Global Warming Solutions Act of 2006 (AB 32)
Requires a declining cap in GHG emissions to reach 1990 levels by 2020
CARB creates a declining number of allowances for GHGs
Allowances auctioned off quarterly starting in 2012
All major sources of GHGs must submit allowances equal to emissions produced
Current market price is $12.50 per ton
utilities 2012
transport 2015
industry 2012
~$1.5B/yr
~$2.5 B/yr
GGRF GHG Reduction Fund
Ratepayers reduced energy bills
transportation 60% permanent
energy/water year-to-year
nat resources year-to-year
Who Pays? Who Benefits?
cap & trade 101
Auction Proceeds
Must be used to further the purposes of AB 32
Utility allowances are used to lower costs to consumers
Remainder of revenue to Greenhouse Gas Reduction Fund (GGRF)
cap & trade 101
GGRF - Greenhouse Gas Reduction Fund
$2 to $4 Billion per year
60% permanently dedicated to transportation
Remainder allocated each year
GHGs and DACsAll cap and trade funding programs are required to reduce GHG emissions. Additionally, SB 535 (de León, 2012) requires that 25 percent of all non-utility cap and trade revenues be used to benefit disadvantaged communities (DAC), and 10 percent to be spent within the most disadvantaged.
Individual cap and trade programs may exceed or be less than the 25% requirement for DACs, but on average the programs as a whole must meet the statewide requirement.
CalEnviroScreenThe determination of DAC status is based on the CalEnviroScreen, a model administered by CalEPA that combines economic data with information on pollution and other environmental impacts
GGRF Programs
2014-15 State Budget provided $832 Million
2015-16 State Budget allocated $2.0 Billion
Programs administered by various state agencies
2015-16 GGRF ProgramsTRANSPORTATION
$400M Housing and Community Development – Affordable Housing & Sustainable Communities
$200M California Transportation Commission – Transit & Intercity Rail Capital
$100M Caltrans – Low Carbon Transit Operations
$500M High Speed Rail Authority – High Speed Rail
$90M* California Air Resources Board – Low Carbon Transportation ($200M in FY 2014-15; subject to annual appropriation)
Affordable Housing & Sustainable Communities Program - $400M20% of total funds ($2 Billion in 2015-16)
50% for Disadvantaged Communities
Administered by Department of Housing & Community Development
Projects must be within SB 375 Sustainable Communities Strategy
Projects must be through environmental review process
Competitive Program to fund two kinds of projects:
TOD+Affordable Housing (>50%)
Integrated Connectivity Projects (infrastructure + program/planning)
Transit & Intercity Rail Capital - $200M
10% of total funds
25% for Disadvantaged Communities
Administered by California Transportation Commission
Competitive program for rail and bus transit operators
Funds capital improvements that integrate state and local rail and other transit systems, and those that provide connectivity to the high‐speed rail system.
Low Carbon Transit Operations - $100M
5% of total funds
50% for Disadvantaged Communities.
Administered by Caltrans
Formula-based program for transit operators and RTPAs (not competitive)
Provides operating assistance for transit ridership
High Speed Rail - $500M25% of total funds
Administered by California High Speed Rail Authority
First year funds included environmental planning, permitting, and design work for the first phase of the California High Speed Rail Project (which would extend from San Francisco to Orange County)
Funds for right-of-way acquisition and construction of the initial operation segment in the Central Valley
Low Carbon TransportationAnnual appropriations; $230M in 2014-15; $90* in 2015-16
Funds a variety of incentive programs including:
Zero Emission Vehicle incentives
Car sharing in disadvantaged communities
ZEV buses and trucks
Freight and other pilot projects and programs
Where are we now?Pressure to increase funding for road maintenance from gas tax and/or cap and trade revenue (current special session in Legislature)
Concern about geographical distribution of funds (e.g. DAC locations mainly in Central Valley)
Complexity of program guidelines and GHG methodology
Measuring GHGs continues to be challenging
